‘P400 M lost to ATM hackers’

MANILA, Philippines – Bank depositors lost nearly P400 million to automated teller machine (ATM) hackers in 2012 and 2013, Pasig Rep. Roman Romulo said yesterday.

Citing data from the Bangko Sentral ng Pilipinas (BSP), Romulo said 2,872 cases of ATM fraud were reported during the two-year period.

In 2013 alone, some P220 million in deposits were looted on account of the proliferation of illegal PIN (personal identification number)-capturing devices on ATMs, he said.

The amount was P45 million or 26 percent higher than the P175 million in deposits lost in 2012 due to the covert copying of information from the magnetic strip of an ATM card, he said.

“These losses do not include the sum lost by cardholders due to conventional ATM robberies or holdups at gunpoint,” he added.

Romulo is author of Bill 5036, the proposed ATM Theft Insurance Act. The measure seeks to require all banks to offer their clients insurance for ATM fraud.

“Banks are duty-bound to safeguard customers and their deposits against all forms of attacks at all times,” the author said.

He said at least one bank, Philippine National Bank, now provides insurance protection to its depositors.

“We consider PNB’s ATMSafe as a ground-breaking, cardholder-friendly initiative,” he said.

ATMSafe pays up to P50,000, or the card’s daily withdrawal limit, whichever is less, to replace cash stolen during an ATM robbery, or when the insured loses cash due to the tampering or mechanical malfunction of an ATM.

The insurance scheme is available to clients for P12 a month.

Romulo said other banks should offer a similar insurance program.

At least one congressman, Rep. Cresente Paez of the party-list group Cooperatives Network Party, has fallen victim to ATM card hackers.

He told his colleagues in a privilege speech that he lost nearly P236,000 in pension from the Social Security System (SSS).

He said he had not been withdrawing from his savings account with United Coconut Planters Bank branch in Blue Ridge, Quezon City where his SSS pension is deposited.

“However, surprisingly, when I made a balance inquiry sometime in May 2013, I noticed that I had only P190.08 left in my pension account,” he said.

He said he immediately complained to UCPB but was told that from April 10 to 20, 2013, in 11 days, daily withdrawals of up to P20,000 were made from his account in various ATM terminals in Quezon City, San Pablo City and Boracay, for a total of P235,808.

He added that he demanded UCPB refund the withdrawn amount, since he did not make the withdrawals and the bank was supposed to safeguard his money.

Paez said UCPB later informed him that his ATM card was cloned when it was used at a Chinabank ATM outlet at the SM Mall in Cebu City.

He asked what Congress and the BSP were doing to protect bank depositors against ATM fraud.

Meanwhile, Parañaque Rep. Eric Olivarez filed Bill 5095 that seeks to allow taxpayers to settle their tax obligations with the use of their credit cards.

Olivarez said allowing the use of credit cards or debit cards for the payment of taxes will encourage more individuals to pay their tax obligations properly.

“Tax evasion will be lessened if people will have an alternative, that is delayed payment secured by the credit card system,” he said.

He said the government will have no problem collecting from every taxable individual what is due of them, as it can directly collect from the taxpayer’s card-issuing bank or financial institution.

“The bank, on the other hand, will have no trouble collecting the accumulated credit card debt from its individual cardholders because it has been expertly doing this practice for decades,” he added.

Bill 5095 mandates the Bureau of Revenue (BIR) to select companies to process credit and debit cards on its behalf for tax payments, and these companies may charge clients a reasonable amount of processing fee.

However, a cardholder may not use his credit card to pay for another person’s tax.

The bill also disallows any person to use or disclose any information relating to credit or debit card transactions made for tax payments.

The taxpayer would be liable for tax evasion in case he fraudulently uses his credit card to evade paying taxes.

“This is without prejudice to the filing by the Bureau of Internal Revenue of civil, criminal and administrative charges against any person or persons conniving for the purpose of evading taxes due,” Olivarez said.