Last week, Bank Negara Malaysia (BNM) announced five new security measures to be implemented by financial institutions in order to reinforce protections against financial frauds, particularly those conducted online.
The modus operandi of criminals would continue to change, according to Governor Tan Sri Nor Shamsiah Mohd Yunus.
“As a result, BNM is constantly expanding efforts and taking actions to prevent scams by implementing more controls and safeguards on a regular basis,” she added.
Among the most recent measures is a requirement for financial institutions to transition from SMS one-time passwords (OTPs) to more secure forms of authentication for online activities or transactions for account opening, fund transfers, and payments, as well as changes to personal information and account settings.
According to Nor Shamsiah, banking institutions would enhance fraud detection regulations and triggers for blocking suspected scam transactions.
“When such behaviour involving their banking accounts is found, customers will be immediately notified.” Financial institutions will also restrict such transactions, and clients will be required to prove that such transactions are real before they are unblocked,” she said.
Furthermore, no online banking activity will be permitted during the cooling-off period for first-time enrollment in online banking services or secure devices.
The governor also stated that customers would be limited to using just one mobile or secure device for online banking transaction authentication, and financial institutions will be compelled to set up dedicated hotlines for customers to report financial fraud instances.
“Financial institutions have been urged to be more receptive to customer fraud allegations.” They have also been ordered to help with attempts to recover and protect stolen cash, as well as to collaborate with appropriate agencies to prevent additional losses,” she added.
Nor Shamsiah mentioned that the BNM expects Malaysian banks to follow rigorous security standards, particularly for online and mobile banking services.
“The central bank also provides security recommendations to the financial industry from time to time, noting the newest modus operandi of fraudsters and extra security measures that banks must adopt to protect their clients’ funds,” she explained.
According to Nor Shamsiah, the Royal Malaysian Police (PDRM) plays an important role in combating scams and has implemented a number of initiatives, including the establishment of the Commercial Crime Investigation Department (CCID) Scam Response Centre to facilitate the public’s reporting of financial scams.
“BNM will collaborate with PDRM, the Malaysian Communications and Multimedia Commission, and the National Anti-Financial Crime Centre to further elevate the CCID Scam Response Centre as a more systematic information exchange platform, allowing for faster action to avert additional losses,” she added.
According to her, promoting public knowledge, including scam methods employed by criminals and procedures that the public may take to prevent becoming victims, is a crucial part in dealing with financial frauds.
“In this context, BNM, the financial industry, and law enforcement authorities will continue efforts to increase the efficacy of awareness programmes and public information distribution,” she concluded.
