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Following is a question by Dr the Hon David Chu and a written reply by the Secretary for Security, Mr Ambrose S K Lee, in the Legislative Council today (January 14):

Question:

It has been reported that in recent months, the Hong Kong Monetary Authority (HKMA) has received 36 complaints from bank depositors claiming that money totalling about $1.9 million had been stolen from their accounts. They suspect that criminals got hold of their personal identification numbers (PINs) while they were using the automatic teller machines (ATMs) and then withdrew money from their accounts. In this connection, will the Government inform this Council of:

(a) the locations of the ATMs at which the criminals got hold of the victims' PINs;

(b) the Police's ways to curb such crimes, and whether beat officers have been asked to keep watch on the activities in the vicinity of ATMs; and

(c) the progress of the study, undertaken by HKMA with banks and relevant institutions, on upgrading the security level of ATM cards?

Reply:

Madam President,

(a) According to the reports received by the Police relating to theft cases suspected to be caused by stolen personal identification numbers (PINs) of ATM cards, occurrence of the crime is not linked to any specific location. Places where reports on this type of crime have been received include Shau Kei Wan, Mei Foo, Kwai Chung and Tsuen Wan.

(b) The Police have approached this type of cases from the following four fronts:

(i) exploring with the banking industry on how to strengthen security features of ATMs;

(ii) educating members of the public to keep their PINs secure and reminding them of the necessary precautionary measures while using ATMs;

(iii) requiring patrol officers to strengthen vigilance in respect of ATMs situated in remote and secluded locations; and

(iv) investigating each of the reported ATM theft cases actively.

(c) The HKMA issued a circular on October 14, 2003 to all authorized institutions (AIs) to set out clearly, among others, the HKMA's expectations on the precautionary measures that should be implemented to enhance the security level of ATMs as well as ATM cards by relevant AIs. The measures include:

(i) enhancing the security features of ATMs;

(ii) continuous monitoring of ATMs by installing closed-circuit televisions;

(iii) implementing a mechanism that records relevant information on ATM cards or credit cards so that AIs can determine whether an unauthorized ATM transaction is carried out through a counterfeit card;

(iv) more regular and frequent patrols of ATMs during and after office hours;

(v) encouraging customers to report any suspicious devices detected on ATMs. Institutions should provide the relevant telephone number for customers to do so at the ATMs; and

(vi) alerting customers if any unusual transaction patterns are noted.

Relevant AIs have taken immediate actions to implement the recommended precautionary measures. Satisfactory progress has been made so far, and it is expected that most relevant AIs will be able to put in place these precautionary measures by January 31, 2004.

In addition, the banking industry is reviewing various options and technologies with a view to further enhancing the security of ATMs and ATM cards. In particular, a seminar arranged by the banking industry, the service providers and relevant vendors was held in December 2003 to explore the feasibility of deploying smart cards or chip cards for ATM transactions. The HKMA will continue to liaise with the banking industry to review the adequacy of the existing measures and, if necessary, implement additional measures to strengthen the security controls.

Ends/Wednesday, January 14, 2004

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