February 4, 2019 / 4:59 PM / 9 months ago

Britain's Metro Bank hit by fraud attack

FILE PHOTO: A logo outside a Metro Bank branch in central London July 28, 2010. REUTERS/Toby Melville/File Photo

LONDON (Reuters) - Metro Bank said on Monday some customers had been hit by a fraud which targets a weakness in telecom companies’ text messaging systems used to verify bank transactions, and the bank said it was a wider attack on British banks.

“Of those customers impacted by this type of fraud, an extremely small number have been Metro Bank customers and none have been left out of pocket as a result,” a spokeswoman for the bank said.

Metro Bank declined to comment on when the attacks took place or were discovered, but said it was among a number of banks targeted.

“We have supported telecommunication companies and law enforcement authorities with an industry-wide investigation and understand that steps have been taken to resolve the issue,” the spokeswoman said.

The news of the fraud attack follows a turbulent few weeks for Metro, an upstart retail bank founded in Britain in 2010 by U.S. businessman Vernon Hill.

Metro shares halved in value in the last three weeks, after the bank disclosed an accounting error that led to a 900 million pound ($1.18 billion) hit to its capital levels.

Short sellers have continued to pile pressure on the bank, Reuters reported last week, betting the shares could fall yet further.

Technology website Motherboard first reported the fraud attack on Metro Bank, saying that cyber criminals had been targeting a weakness in global telecommunications infrastructure that has been known about for some years.

The cyber criminals intercept text messages sent to bank customers’ mobile phones as part of the process of authenticating transactions, Motherboard reported.

Reporting By Lawrence White. Editing by Jane Merriman

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