by TerranceBoyce
Sat Nov 14, 2015 8:07 am
http://www.onemk.co.uk/news/2015/11/alleged-milton-keynes-fraudster-conned-wonga-out-of-3m-by-stealing-identities-of-19000-people-121120150015.html
This highlights one of my major bugbears within the UK, namely the existence of thousands of bank accounts used for money laundering by criminals, for which there exists no effective procedures to prevent. Bearing in mind that many billions of pounds go through these accounts which the authorities recognise are used to support crime and even terrorism, you'd imagine that there might exist some desire to address the problem, but there is little evidence that anything has been done to remove the vulnerabilities.
Amazingly enough the same thing happened to a previous payday loan company in the UK which brought about their collapse. If you have a weakness in the banking system and also in loan company procedures, criminals can exploit what is effectively a money making scheme.
Technically there is no such thing as 'identity theft'. A person's details may be stolen but if they are used by a thief then he is guilty of 'impersonation. My identity cannot be 'stolen' as to steal my identity they would have to deprive me of the use of it which rarely happens. I suspect that banks would like to make victims of 'identity theft' responsible for any losses incurred, when actually it's faulty ID checks that have enabled the crime.
If you have a system where banks' don't properly identify account holders, and lenders who do the same, then the potential for criminal exploitation is obvious.
Anyone with a basic knowledge of the UK banking system knows that no such algorithm exists. I won't state the obvious flaw again, but banks will always ignore flaws in systems when only the public suffer but now that major institutions and banks themselves are falling victim to their own flaws they may do something about it.
Obviously if I haven't taken out a loan, then irrespective of what details the fraudster provided to the lender, I am not liable to repay it. He is an 'impostor' and the lender's procedures have failed to detect it. They may threaten me with what they like but their action will fail because they will not be successful unless they can prove that I received the loan which, in this case, is impossible.
Payday lenders are particularly vulnerable because they rely on abbreviated identity checking but that is fatal when the identity checking for opening bank accounts is already flawed.
13 Nov 2015
Alleged Milton Keynes fraudster 'conned Wonga out of £3m by stealing identities of 19,000 people'
This highlights one of my major bugbears within the UK, namely the existence of thousands of bank accounts used for money laundering by criminals, for which there exists no effective procedures to prevent. Bearing in mind that many billions of pounds go through these accounts which the authorities recognise are used to support crime and even terrorism, you'd imagine that there might exist some desire to address the problem, but there is little evidence that anything has been done to remove the vulnerabilities.
Fraudsters conned controversial payday lenders Wonga out of £3m by hijacking the identities of thousands of innocent members of the public, a court heard on Monday November 9.
The criminal gang, including a man from Milton Keynes, exploited the company's faulty website algorithms to make more than 19,000 applications for money to be paid into bank accounts under their control, it is claimed.
Amazingly enough the same thing happened to a previous payday loan company in the UK which brought about their collapse. If you have a weakness in the banking system and also in loan company procedures, criminals can exploit what is effectively a money making scheme.
Wonga also failed to spot that all of the fraudulent applications used the same password 'Bengali90', jurors were told.
Meanwhile the unsuspecting victims were left paying the one per cent interest payments, it is claimed.
'Some repayments were actually made to Wonga fraudulently - in other words some innocent people made repayments for loans which they hadn't applied for.'
Technically there is no such thing as 'identity theft'. A person's details may be stolen but if they are used by a thief then he is guilty of 'impersonation. My identity cannot be 'stolen' as to steal my identity they would have to deprive me of the use of it which rarely happens. I suspect that banks would like to make victims of 'identity theft' responsible for any losses incurred, when actually it's faulty ID checks that have enabled the crime.
If you have a system where banks' don't properly identify account holders, and lenders who do the same, then the potential for criminal exploitation is obvious.
Applications were made online by entering names, addresses and dates of birth together with the debit card number used to make repayments and the details of the account receiving the cash.
Wonga uses an algorithm to determine whether the information provided is correct and whether the account number matches the name and other details of the person applying for the loan, the court heard.
Anyone with a basic knowledge of the UK banking system knows that no such algorithm exists. I won't state the obvious flaw again, but banks will always ignore flaws in systems when only the public suffer but now that major institutions and banks themselves are falling victim to their own flaws they may do something about it.
Obviously if I haven't taken out a loan, then irrespective of what details the fraudster provided to the lender, I am not liable to repay it. He is an 'impostor' and the lender's procedures have failed to detect it. They may threaten me with what they like but their action will fail because they will not be successful unless they can prove that I received the loan which, in this case, is impossible.
'The money was paid into bank accounts that had nothing to do with the people named in the loan application.
Payday lenders are particularly vulnerable because they rely on abbreviated identity checking but that is fatal when the identity checking for opening bank accounts is already flawed.
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