Halifax Net share dealing system breached

The Halifax admitted Monday that a flaw in its online security allowed a customer to gain unauthorised access to its Internet trading accounts on Friday morning.

The bank immediately pulled the plug on its Internet share dealing system, Share Express. A spokeswoman for the bank attempted to play down the significance of the breach saying, "There are bound to be a few teething troubles with any new system. The problem was discovered on Friday and the service was back up this morning. The fault has been eliminated and we've checked our servers and found that no illegal trading took place."

The spokeswoman confirmed the Halifax is doing its utmost to restore the confidence of its customers. "We have been contacting all our customers today to reassure them that no-one was disadvantaged by the incident. Obviously we apologise to any customers who were inconvenienced."

But as Web users in the UK approach what has been hailed the first real e-Christmas, at least one commerce analyst, Nick Jones with Jupiter Research, suggests this is the very last thing any financial institution needs. "Consumers are extremely concerned about security," he says. "We recently asked consumers what would stop them from carrying out financial transactions online. 41% said they were worried about security."

Jones however also says that in his view, the Halifax has done absolutely the right thing by coming clean. He says, "You always hear stories about this sort of thing and I think admitting it is a very good thing. In order to build consumer confidence you need to have dialogue."

A spokesperson for the Financial Sevices Authority, which deals with complaints concerning financial institutions, said customers unhappy with the Halifax' explaination should contact his organisation. "The first thing a consumer should do if they feel they have been treated unfairly or incompetently is to contact the firm. If they are unhappy with the outcome they can complain directly to the FSA."

A leaflet on the complaints process is available from the FSA Web site and the complaints hotline is 0207 676 0906.

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