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US Appeals Court Says Bank Liable For Losses From Poor Online Security
An anonymous reader writes with this extract: "Threatpost reports that a judge on the United States Court of Appeals this week ruled that People's United Bank's processes and systems for protecting customer accounts from fraud were not "commercially reasonable." The ruling in People's United Bank (formerly Ocean Bank of Maine) versus Patco Construction Company reverses a lower court's ruling in a case that stems from six allegedly fraudulent transactions that occurred over the period of a week in May, 2009 and drained close to $589,000 dollars from Patco's accounts. Patco alleged that People's United Bank did an inadequate job of protecting them against fraud, ignoring repeated 'high risk' warnings from the bank's fraud detection system. Now the Appeals Court appears to agree. The ruling could have broad implications in the U.S., where businesses that are the victim of account takeovers and fraudulent transactions are suing banks to recover lost funds."
I still get that cuddly, fuzzy Russian Soviet communist feeling every time I see or hear the word People's.
This video properly explains it.
RTFA.
Apparently the issue is that although individuals are protected against fraud by legal statutes, businesses are not.
But, but but.... I thought corporations were people!