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UK ATM System Could Have Ruined Economy
seanyboy writes "The Register is running the story of how the UK banking system could have collapsed in the early 1990s, how easy it was at the time to withdraw against other people's accounts and the worrying case of a Bank's rogue IT Department." From the article: "What quickly became clear was that the law needed a system to provide proof that events had happened so that legal cases could be made. You might say that 'the computer debited the account', but to a barrister (and more importantly, a judge) that's not enough. Did the computer do it at random? In that case it's like a tree branch falling - an accident. Or did a person program it to do so? In which case the person must be able to testify about the precise circumstances when a debit could happen. Sounds daft, but the law rests on proving each step of an argument irrefutably."
The worst part of the story was that the lawyer couldn't tell anyone about the security problem because he was no longer retained by his original client. I believe that in the US attorneys are obliged to come forward with information related to a criminal nature because they are officers of the court. I don't know if that distiction would have helped in this case, but the fact that the whole system perched precariously on the fact that only a few criminals knew how to bilk the system is disturbing.
"Rocky Rococo, at your cervix!"
I had an account with National Westminster in '87 when I lived in the UK. The ATM's would always let you take cash out no matter how much in the red you already were. (It was my roommate that took advantage of it, not me, honest!)
I went to withdraw from an ATM. I put the card in, entered my PIN, and selected the amount I wanted - $200.
The ATM goes nuts and procedes to give me only $160 while debiting my account two transactions: one for $200 and another for $160.
I call my credit union and I tell them what happened. They tell me to fax a letter stating that I was diputing the $200. I did. They audited the ATM.
Long story short, the credit union backed out the $200 debit.
Evil people don't think they're evil. - George Lucas, Making of Ep III
computers have been a synonym for organized fraud in other places.
In Mexico, in the 1988 elections, the opposition candidate was winning by a large margin according to the official data. Then suddenly, "the system crashed", and when it came up, the official party was winning by a large margin.
This event was called "La caida del sistema de 1988", and makes me think that there's nothing new under the sun (Diebold voting machines, anyone?).
The lesson is clear: Regarding data and computers, if someone can do something wrong, he WILL. So auditing is a must.
In the late 80's,
There was a known fault on some of the ATMS where the "picker" and the "presenter" units could go into a runaway condition.
This happened on London's Edgeware Road while the shutter (remember them) was open.
So there we were with the ATM spewing £5's and &10s all over the street as fast as it could pick them.
A number of passers by collected up the money while another went into the bank to alert the staff.
Amazingly when the bank balanced the ATM they found that there was no money missing.
A retrofit was quicly engineered to prevent the presenter motors running when the picker unit was in operation.