By Kutler, Jeffrey; Mead, Wendy S.
American Banker , Vol. 162, No. 39
Consumer resistance isn't all that bankers must overcome to make Internet services a reality.
They also have to contend with their own industry's security experts.
And when bank security people ponder the implications of a mass market in on-line banking and commerce, as they did at a conference in New York last week, sparks can fly.
The security community, already stirred up about scary new possibilities for attacks against established computer networks, isn't quite ready to give newer developments like stored-value cards and digital cash a clean bill of health.
That might be good news for the promoters of the next wave of interactive banking. They have time to do their system building. The watchdogs who might slow them down have more immediate worries.
* * *
Electronic sabotage, for one. Or information warfare that might be launched against the United States by way of its financial system. Or what computer security experts refer to as a "denial of service" attack-perhaps by a hacker who finds a way to shut a financial institution's virtual doors, or by forces beyond the institution's control that cut or disable telecommunications lines.
The hazards are heightened as banks become increasingly dependent "upon the Internet as a transport mechanism to provide both revenues and profits," said Winn Schwartau, president of the Seminole, Fla., consulting firm Interpact Inc. and author of "Information Warfare," a definitive book on the subject.
"If your lines are busy, not necessarily only for hours but for days, what happens to customer confidence?," said Mr. Schwartau, who served as chairman of the National Computer Security Association's International Banking and Information Security Conference.
One of his slides showed a Web page that enabled its visitors to send anonymous E-mail bombs, which overwhelm recipients with hundreds or thousands of messages. The page provided a space to type in "terrorist demands."
Mr. Schwartau showed "a collection of increasingly hostile applets," which he described as "specific harassment tools designed to shut down Web servers."
* * *
No banks yet are known to have been disabled or paralyzed by mail bombs or terrorist applets. That may be because the Internet isn't yet where much money is.
But several references were made to "the Citibank case," an infiltration by Russians into the bank's wire transfer operation. It did more symbolic than monetary damage, but was seen as a sign of threats to come.
David Luther, president of the Security First Technologies network security division, the group responsible for the many layers of security safeguarding Security First Network Bank on the Internet, said his system has detected only a series of amateurish nuisance attacks.
Frank Trotter, senior vice president of Mark Twain Bank in St. Louis, the first in the Americas to test Digicash Inc.'s Ecash system, acknowledged banks have "a security risk" and must face the fact that "privacy is a paramount issue in consumers' minds."
But both practitioners viewed the new technologies as solutions, not problems.
Mr. Trotter said "a great leap forward is coming" as Ecash is integrated more closely with bank accounts, establishes a brand identity, and gains adherents around the world.
Mr. Luther predicted consumer acceptance will gather momentum as early as this year as telephone and cable television companies offer "dial-tone access to the Internet" and home banking becomes "just another channel flip."
* * *
Mr. Luther, among others, referred to the classic risk-management calculation-the trade-off between an absolute level of security that would make interactive services very difficult to use, and the desire to attract customers through convenience and ease of use.
Some bankers in the New York audience last week took offense when Robert Ayers, chief of the Defense Information Systems Agency's information warfare division, criticized their risk management mentality-and that of corporate America in general. …