Red Light Illuminated for Us: Prosecutor on Banks

There are banks that have strong security systems and those that do not. This was stated today by Armenia's Chief Prosecutor Anna Vardanyan during a meeting of the National Assembly’s Standing Committee on State and Legal Affairs, addressing the rising statistics on phishing and numerous complaints received from citizens.

According to Vardanyan, a request has already been sent to the Central Bank of Armenia this year, asking the relevant body, such as the Union of Banks, to engage in discussions with specific banks that lack adequate security systems. “In some banks, we encountered very unclear algorithms for online banking services. A person physically goes to the bank, is denied a loan of, say, 500,000 drams, but receives an online loan of 3 million drams. Here, a red light has been illuminated for us, indicating that the algorithm used in online banking has a very low protection threshold,” Vardanyan mentioned.

She noted that banks that are frequently involved in phishing-related incidents have been identified. The prosecutor emphasized that they consider the weak security systems to be part of the problem. There is already an agreement with the Central Bank for the prosecutor's office and the banking system to work together to find a quick solution to this issue.

Vardanyan highlighted that there is also a problem that notifications regarding transactions related to the account may be received in English, and individuals may not understand what is happening, thus unable to prevent fraud. “We have banks that alert citizens via phone before any transaction saying, ‘Are you making a transfer from your bank account?’ This has had serious preventive significance,” the prosecutor stated.

She added that although there are cases where people voluntarily provide their information to criminals (not suspecting that the call is not from the bank), ultimately, the final transactions occur through the bank. In her opinion, if a bank has a slightly more secure system, it can prevent fraud.

“There are banks where phishing cases are less common because they have staff who inform clients by phone, the notifications are in Armenian, and they have stricter systems in place. It may cause a bit more inconvenience to the bank user, but it ensures they do not become victims of such fraud. There are banks that are lenient and do not provide a certain trail; we have raised an alarm in that regard and said that work needs to be done here to change the format,” she noted.