Thomas Claburn and Steven Marlin, InformationWeek
Evidence that the Internet's killer app is seriously ill can be seen in the frantic efforts to resuscitate it. The past two weeks have witnessed a flurry of activity aimed at restoring trust in e-mail as a business-consumer communication tool that has been eroded by spam and e-mail-related online fraud.
How worrisome have the problems become to businesses? Bad enough that MasterCard International last week said it has created a system for round-the-clock monitoring to inform 25,000 financial-institution members worldwide within four hours of when such a scam starts. Bad enough that fierce rivals in the e-mail business -- America Online, EarthLink, Microsoft and Yahoo -- agreed last week to support each other's e-mail-authentication standards. It's also prompting a consortium of the 100 largest financial institutions to develop a common database to share reports of attacks and responses, and forcing some banks to reconsider how they use e-mail to communicate with customers.
MasterCard is using digital fraud-detection technology from NameProtect as part of a more-proactive approach to online fraud that lets the company detect scams as they unfold and work with police to block them before losses occur. 'We're concerned that somebody step up to the plate because consumer confidence is at stake,' says Sergio Pinon, senior VP of MasterCard's global security and risk services.
Research firm Gartner estimates that 57 million Americans in the past year received phishing e-mails -- messages sent to lure people to phony Web sites asking for financial information. During a two-week period in December, 60 million phishing messages were sent, according to the Anti-Phishing Working Group, of which both MasterCard and NameProtect are members. Identity theft is the endgame for many phishing schemes and has been the No. 1 consumer complaint to the Federal Trade Commission in the past four years. Gartner estimates that phishing-related fraud cost banks and credit-card companies about $1.2 billion in direct losses in the past 12 months."