Exclusive: Egg admits security breach

UK Online bank Egg, blamed "human error" Wednesday for the security breach which allowed a user to access another customer's account.

Alfredo Maio, business development manager at software firm SCO, logged onto his Egg account a week and a half ago to find someone else's banking details on his screen. He called Egg immediately and was told it was an isolated incident caused by a software failure. According to an Egg spokeswoman Wednesday morning, a "breach of internal procedure" caused by human error led to the breach.

Maio is outraged by the incident and wants assurances it won't happen again. "I had access to someone else's account and information. I could have done anything to it," he said. Scrambling to defend itself, Egg promised there would be no repeat incidents. "We accept it is not best business practise and we hold our hands up. There was a breach of IT procedure during a routine update to the security system," the spokeswoman said. "We closed the system down immediately. There were less than five customers affected."

Halifax was the victim of a similar security breach last week -- with a customer logging onto someone elses share details. A Halifax spokeswoman claimed its online share dealing system is now safe and is confident the incident has not dented consumer confidence in the run up to Christmas. "There has been no impact. On Monday [when the system went live again] we had double the normal registrations. Only two customers closed their accounts," she said.

The Egg spokeswoman claimed that future system updates will be completed when the site is not live to protect customers. Unimpressed Maio is closing his Egg online account and intends to open another with NatWest.

Several Egg customers have contacted ZDNet News expressing concern over the incident. One, marketing manager Susan Rundle, summed up the attitude of many. "My confidence in Egg is definitely cracked. I am seriously considering closing my account down."

Jupiter analyst Nick Jones thinks the incidents could affect consumer confidence. "A few blips on the chart like this is bound to be a consideration but I doubt it will be a big influence. Security is a dominant issue but it is not the only one holding people back from online shopping," he said.

UK manager of Internet bank first-e Richard Thackray expressed his sympathy for Egg. "I am upset for them. When things like this happen it reflects on the whole industry," he said. He admits the incidents are bound to influence consumer confidence in online banking. "It is not a good message to send out and it may dampen the move to online but it won't stop it," he said.

Will Knight contributed to this story

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