BSP exhibit educates consumers v. fraud

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Tuesday, September 2, 2014


AMID growing deposits, loans and improved quality of services in the banking sector, a top official of the Bangko Sentral ng Pilipinas (BSP) reported growing consumer complaints, particularly on financial frauds and scams.

The most common complaint they received, according to Johnny Noe Ravalo, BSP’s assistant governor for Financial Supervision Research and Consumer Protection Sub-sector, is on automated teller machines (ATM) card “cloning.”

Although this is not a new concern for the banking sector, Ravalo said the crime has become prevalent with ATM cards now being linked globally and perpetrators becoming bold.

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“We received complaints of illegal withdrawals being done in foreign countries even though owners claimed they have not been to these countries,” Ravalo said in a press conference yesterday.

Ravalo was in Cebu to unveil BSP’s latest advocacy campaign on financial consumer protection called AlertoAko, a proactive exhibit on financial consumer protection advisories.

The campaign aims to provide financial consumers greater awareness through advisories on various financial products and services empowering consumers to make informed financial decisions.

The BSP said this is also a proactive approach to address the need of the public to identify financial frauds or scams. The exhibit features display panels showing the various financial scams, how to detect and avoid them, BSP’s key advisories, interactive games and activities, audio visual presentations and short individual lectures on financial products, frauds and scams and consumer protection.

Pilot area

The team picked Cebu as the pilot area of the project on the back of the province’s growing economy and a young demographic, whose age profile is lower than the country’s average age of 24 years old.

Ravalo said the launching of AlertoAko is a timely project given that the Philippines is the only country given a positive financial rating based on the 2014 report of credit rating firm Moody’s, which monitors financial standing of 75 countries.

“Despite the habit of Filipinos to withdraw money when financial problems arise, the sector sees continued growth in deposits in the last seven years at 23-24 percent...resulting in a massive liquidity in the system. Non-performing loans ratio, on the other hand, stood at 2.17 percent lower than the 1997 Asian financial crisis,” said Ravalo.

He, however said, that these positive developments should be complemented with a well-informed and smart financial consumer market.

“Through this exhibit we will be able to tell people new versions of scams and inform them on how they should protect themselves against these financial scams and frauds,” he said.

Ravalo said the BSP has upgraded its information technology (IT) standards. Banks, on the other hand, are starting to move away from the use of magnetic strip technology in ATMs and credit cards to EMV chip technology to combat card fraud. Some 1,272 cases of ATM card fraud involving P220 million were reported in 2013.

Ravalo said the EMV chip technology is protected by various security features. The BSP has set 2017 as the deadline requiring all local banks to shift from the magnetic strip to EMV chip technology.

The BSP is also expecting local banks and ATM deployers to be 100-percent Triple DES (3DES)-compliant by 2015. This feature uses a three-layer IT security that can prevent hackers from attacking ATMs.

Card skimming

While efforts are in place to counter card “cloning” and “skimming,” Ravalo urged the banking public to also do their part.

“I urge the public to pay attention to their balance or their last transaction and if they notice discrepancy they have to report it immediately to the bank,” he said.

Consumers should also keep in mind the phone number of their bank, credit card or ATM account number and the last two to three transactions done as these are vital information needed when filing complaints. He also discouraged consumers from keeping account numbers and passwords in their wallets.

While filing an ordinance that requires all banks to deploy security guards in their ATMs 24/7 is a welcome development, Ravalo said it also has consequences such as the cost of doing business.

“The 1:1 ratio may not be warranted given the various versions of scams these days,” he said.

The AlertoAko campaign is spearheaded by the BSP’s Financial Consumer Affairs Group.

It is open to the public from Sept. 2 to 4 from 8:30 to 5:00 pm at the BSP Regional Office on Osmeña Blvd.

The exhibit will be put up across the country to enable the BSP to cover more ground in teaching the citizenry to become smart financial consumers who are vigilant of financial scams and frauds.

After Cebu, the exhibit will be mounted in Manila at the BSP’s head office and will be eventually rolled out in other key cities across the country by 2015.

Published in the Sun.Star Cebu newspaper on September 03, 2014.

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