SWIFT to Send "Daily Validation Reports" While Bangladesh Bank Recovers $81 Million

The inter-bank messaging system announced that it plans to send daily transaction reports to its clients, as to avoid the type of fraud that caused the Bangladesh theft.

The report, to be introduced in December, will include both Activity Reports and Risk Reports aimed at identifying suspicious messaging activity and unusual payments between various parties. Delivered via an “out of band” channel to prevent tampering by cybercriminals, the report is said to help banks detect fraudulent transactions.

“Smaller institutions, in particular, are currently dependent on the accuracy of the data on their own systems, but in the event of a security breach, their locally stored payment and reconciliation data may be altered or unavailable,” said Stephen Gilderdale, Head of SWIFT”s Customer Security Programme. “Daily Validation Reports will provide a reliable and independent source of information, providing such institutions with an activity lens to help them quickly detect fraud – whether perpetrated by external attackers or by malicious insiders.”

The Philippine regional trial court ruled that $15 million transferred by the cybercriminals to Bangko Sentral ng Pilipinas (BSP) will be returned to the Bangladeshi bank that nearly lost $1 billion. While the casino junket operator, Kim Wong, who received the $35 million will return $15 million, the Bangladesh bank also seeks to recover an additional $2.7 million from the Philippine casino regulator.

“(The) court ordered the release of the cash now in the BSP vault in favor of the People’s Republic of Bangladesh,” Paras told Reuters,” said Ricardo Paras III, chief state counsel of the Philippines’ Department of Justice.

While it”s unclear how much of the losses the Bangladeshi bank can recover, the investigation is still underway. On the other hand, SWIFT is confident that the new anti-fraud reports could allow banks to avoid the same type of fraudulent transactions from occurring again.