Consumer Protection Plan "Flawed"

A new report claims that consumers are left at risk, say MPs. According to the report, the UK consumer protection system has failed to keep up with the digital revolution, leaving people at risk of scams. The result of this is online shoppers being at risk of email scams and fraud, says the Commons Public Accounts Committee.

So who are the fraudsters? The rogue traders are typically based in areas with minimal policing, from where they are able to scam people nationwide. The amount consumers lose to these scams is estimated at £6.6bn anually. Of this, approximately £4.8bn is the result of mass market scams such as counterfeiting and unscrupulous traders.

Cybercrime and fraud prevention specialist Tero Pollanen had the following to say "Cybercrime is an ever increasing issue, and is costing businesses billions. Unlike ‘traditional’ crimes, cybercrime is not localised, it is an international problem that can be carried out from almost anywhere. One of the biggest issues is understanding where an online crime is committed, and how to bring varying international rules inline with oneanother".

The report by the Commons Public Accounts Committee echoes Tero Pollanen, and also the conclusions of the National Audit Office in describing the consumer protection system as "fragmented". Whilst the government is spending on consumer law enforcement, the report found repeated inconsistancies. Staffing, for example, ranged from two to 80, and there was not a uniform level of help and assistance for consumers across the country. This results in "enforcement deserts where local authorities do not spend enough money to provide an acceptable level of protection to consumers," the report said.

Fraudsters wanting to abuse this set up in one of these "enforcement deserts", and with today’s technology allowed them to find their victims nationwide. The report found that the current protection system had "failed to keep pace with online traders".

"When the enforcement system was first established, trading was more localised and consumers tended to lose money through singular instances of malpractice, for example, by being overcharged or sold a short measure," the report said. "Now, the increase in the number of companies who operate nationally and the trend towards online shopping have caused problems which are more likely to affect consumers on a regional or national level." As cybercrime and fraud prevention specialist Tero Pollanen stated previously, there are no clear arrangements for who should take on the task of large, expensive cross-border cases.

"The department must ensure that these changes do not allow new sophisticated scams to emerge and persist without challenge," said Margaret Hodge, who chairs the committee. "Doorstep selling of substandard or non-existent services is a massive issue for consumers, particularly those who are vulnerable. The department has too little information on what the cost of protecting consumers is or how successful current interventions are."

Tero Pollanen

Cybersecurity defences put to the test

EU and US cybersecurity experts have stress-tested their response to an online attack.

Following a global rise in cybercrime and hacking attacks, Brussels played host to the European and US online security exercise this week. The event was the first time both had come together to role-play an emergency scenario. A similar scenario had been played out last year by the just the European nations. Organisers confirmed the findings were worrying, stating the nations "must increase their efforts".

This week also saw the London Conference on Cyberspace, at which the EU Digital Agenda Commissioner Neelie Kroes said "Recent high profile cyber attacks show that global threats need global action,". In addition to this, the UK intelligence agency, GCHQ, recently warned of a "disturbing" number of cyber attacks against Britain. Britian isn’t alone though, other countries have also seen an increase in the amount of attacks.

Professor Udo Helmbrecht from the EU's security adviser Enisa explains that as "The internet is an important backbone of our society - we use it for business and in our private lives. The more we depend on it, the more we need to share information to protect the infrastructure." This dependancy on the internet means we need to prepare for attacks on it. "We have an increase in cyberthreats and incidents so we need co-operation," he went on. "Today's exercise provides valuable lessons for specialists on both sides of the Atlantic."

Industry expert and cybercrime specialist Tero Pollanen "It’s great to see Europe and the US working together on this. Cybercrime is an ever increasing issue, and is costing businesses billions. Unlike ‘traditional’ crimes, cybercrime is not localised, it is an international problem that can be carried out from almost anywhere. As the risks and threats are global, we should all be working together to contribute to finding solutions".

Recent online attacks include a Trojan, where information from chemical and defence firms was at risk, and also Duqu malware attacks against large organisations around the world.

In this weeks test, two scenarios were played out: one attempting to steal and publish information from the EU’s security agencies, and secondly to disrupt energy industry control systems. In doing so, the idea was for everyone to know who could offer what support on the other side of the Atlantic. In an interview with the BBC, Prof Helmbrecht said " We have to detect the incident and where it comes from… "Then we have the computer emergency response teams in the various countries which have to exchange information and decide what can be done - this will depend in part on legal requirements."

Proving a success this year, Enisa said it hoped to further its reach to even more countries in further testing next year.

London Conference on Cyberspace 2011

The 1-2 November sees London host an international conference on cyberspace security.

Representatives from 60 nations are gathering to discuss how to tackle the increasing levels of cybercrime. Those attending include foreign secretary William Hague, EU Commissioner Neelie Kroes, a variety of leading cybersecurity experts and technology entrepreneurs such as Wikipedia founder Jimmy Wales, Cisco vice-president Brad Boston and Joanna Shields, a senior executive at Facebook.

The topics set to be addressed at the Cyberspace Conference include cybercrime, safe and reliable access, and international security. For full details of the conference, visit: http://www.fco.gov.uk/en/global-issues/london-conference-cyberspace/. With cybercrime estimated to cost £600bn a year worldwide, there is a huge economic incentive to invest in fraud prevention and eCrime deterrents. Convening the London Conference on Cyberspace, Foreign Secretary William Hague urged a "global co-ordinated response" on policy. "We want to widen the pool of nations and cyberusers that agree with us about the need for norms of behaviour, and who want to seek a future cyberspace based on opportunity, freedom, innovation, human rights and partnership, between government, civil society and the private sector. "The response does not lie in the hands of any one government or country but it is too important to be left to chance. This needs to be a collective endeavour, involving all those who have a stake in cyberspace" he said. William Hague added that the government has put aside £650m of additional funding to help tackle computer-based threats over the next four years.

 

The foreign secretary, in a direct challenge to China and Russia, told the conference that global treaties policing the web would be counter-productive, insisting that cyberspace must not be "stifled by government control or censorship" as "Nothing would be more fatal or self-defeating than the heavy hand of state control on the internet" going on to say that it was his his "passionate conviction that all human rights should carry full force online".

 

Mr Hague set out the varied problems the world was facing: "Rising costs to business from cyber crime … companies being held to ransom by hacktivists, and the theft of intellectual property sapping prosperity and innovation… "For individuals, a heightened risk of exposure to crime as efforts to clamp down on crimes such as child pornography in one part of the world are rendered ineffective by illegal practices on networks in other countries… "And for governments, threats to critical infrastructure, the loss of tax revenue or the defrauding of government services, the theft of confidential national information and vulnerability to attacks in cyberspace."

As Tero Pollanen, an expert in the prevention of cybercrime and fraud, points out: "crime statistics show a transition from traditional organised crimes to the new seemingly faceless cybercrime. The resulting loss for the financial services industry is astronomical."

As to the outcomes of the conference, Britain said it wanted to develop a set of international "rules of the road", establishing "norms of acceptable behaviour" in cyberspace. "The ideas and proposals we hope to emerge from the conference will develop into the 'London Agenda' - an inclusive and focused approach to help us realise the enormous potential cyberspace offers for a more prosperous, safe and open networked world."