USA today has an interesting article regarding the risks associated with online banking. The article describes the ordeals of an Ameritrade customer that had $60,000 worth of securities transferred out of his account and a Bank of America business customer that had over $90,000 transferred out from his bank account.
While some legal protections are available to consumers in the US, the same does not hold true for commercial customers. Also, while most online transactions are now commonly performed using secure encryption to protect the messages going back and forth across the Internet, it is still possible for a virus program or trojan horse installed on the customer’s computer to capture login information and transmit it electronically to criminals.
Anti-virus program, anti-spyware programs and personal firewalls are all important to help protect against this type of fraud. Various upgrades to online authentication protocols being considered by Bank of America and other financial institutions are also important. However, in my view real protection will only come from using two-factor authentication techniques such as the devices such as those sold by RSA.