By now you’ve probably dealt with the repercussions from the June 14 MSNBC
report by Bob Sullivan entitled, Survey: 2 million bank accounts robbed,
followed by the subhead, Criminals taking advantage of online banking,
Gartner says. A consumer (or senior banking manager) reading the article
would likely come away believing that two million U.S. consumers lost money from
their checking accounts due to online banking. ¹

 

In fact, here is what Gartner actually said in
its report²:

 

Illegal access to checking accounts is the fastest-growing type of
consumer fraud, and may be proliferating through online channels.
(emphasis mine)

 

The report goes on to say that most consumers do not know how their checking
accounts were robbed: Only 17% believed their info was stolen off the Internet;
another 10% reported wallets stolen; and only 5% recalled giving up personal
info to phishers.

 

Gartner also said that 70% of the online consumers reporting losses also
report that they banked or paid bills online, “which exposes their (codes) to
the Internet.” However, what Gartner failed to point out was nearly 70% of
online consumers that weren’t robbed also bank or pay bills online, so
it’s a meaningless correlation.

 

Finally, consider the research methodology. It looks staggering in the
headlines to say that two million people were robbed. But my
back-of-the-envelope calculations indicate this huge number was extrapolated
from fewer than 75 respondents reporting a recent unauthorized checking account
withdrawal (from Gartner’s survey of 5,000 online adults). Some fairly large
errors can occur generalizing a small sample size to the entire population. I’m
not saying it’s wrong, but one should be wary.

 

As bad as the MSNBC article looks for the online banking industry, the NBC
Nightly News with Tom Brokaw got even more carried away. They took an even
bigger number, 4.5 million, which Gartner said is the number of people who have
ever had an unauthorized checking account withdrawal, and mistakenly said that
all those people were robbed via online banking. Here’s MSNBC’s synopsis of the
TV feature posted online next to the Sullivan article (see inset):

 

An estimated 4.5 million Americans have had money stolen from their
Internet bank accounts. NBC’s Bob Hager reports.

 

This is a great example of what happens when a respectable piece of research
is taken out of context. It begins to have a life of its own as other news media
echo the original broadcast.

 

While many subsequent news articles echoed the conclusions of the original
MSNBC piece, some dug deeper. For example, NBC affiliate WEEK-TV quoted
Peoples Bank (Bloomington/Normal, IL) CEO Ed Vogelsinger as saying that
despite having 20% of their base using online banking, so far no one has
reported any Internet banking fraud. Way to go, Ed.

 

We urge our readers to take appropriate steps through their PR channels to
set the record straight. At a minimum, be prepared to rebut the MSNBC numbers if
approached by the media, and feel free to send any reporter our way to
corroborate your position.

 

Contact: Jim Bruene, Editor, Online Banking Report, 206-517-5021 or email
jim@onlinebankingreport.com .

 

¹ Reference: <
http://www.msnbc.msn.com/ /id/5184077/>

² Banks Must Act
Urgently to Stop Account Hijackers, by Avivah Litan, Gartner, June 14,
2004