PH banks build up defense vs cybercriminals
As the Philippines emerges as a hotbed of online gaming firms, it has also become an attractive target for international cybercriminals, challenging banks to invest in stronger firewall and IT risk management systems.
With the boom in Philippine offshore gaming operators, or Pogos, banks that have bagged some of these Pogo accounts have likewise observed an increase in phishing or cyber-probing if not outright cyberattacks, Union Bank special assistant to the president Genaro Lapez said in an interview with the Inquirer.
Banks are thus bracing for hacking attempts by cybercriminals into those Pogos, being “money pits,” he said.
Union Bank, itself, which is one of the most technology-savvy banks in the country, has some Pogo clients. Other banks with more Pogo accounts have also seen increasing cyber-probing, if not outright attacks, Lapez said.
“Their bettors are from overseas, so you use the Philippines basically like a clearing account. If you’re a cyber thief, you’ll always look for where the weakest point is and not to discredit the Philippines—reality being what it is—chances are we have a weaker link in the [global] chain,” Lapez said.
In 2016, the Philippines was thrust into the global spotlight when some $81-million fund stolen by cyber hackers from the Bank of Bangladesh slipped through a Makati branch of Rizal Commercial Banking Corp. and laundered in local casinos.
Casinos have since then been subjected to stringent reporting obligations under the antimoney laundering law. But the burgeoning Pogo industry—which serves overseas retail bettors—is not covered by the anti-money laundering regulations.
The Philippine Amusement and Gaming Corp. expects the fees paid by Pogos to the government to surge to P6 billion this year from P3.1 billion last year. The government opened the licensing for Pogos in late 2016.
“At the end of the day, it generates cash just like a brick and mortar casino. The only technicality is the transaction is done by an overseas party but that doesn’t necessarily mean the cash doesn’t touch the Philippine banking system. So if it does touch the Philippine banking system, that could be point of attack for those aspiring to get hold of Pogo earnings,” Lapez said.
Union Bank, which was cited by Singapore-based magazine The Asian Banker as the “best in cybersecurity and IT risk management” in the Philippines, invited the media recently to view its 24/7 integrated operations center at a confidential location. It is a collaborative facility for teamwork and communication among its cybersecurity pillars to develop effective security measures and counter constantly evolving cybersecurity threats.
A situation room or “war room” is stationed in between the security operations center and the IT operations center, ensuring faster collaboration in tackling any issues, downtimes and incidents that may arise. It is also responsible for monitoring the performance of systems, servers and applications, and of the uptime of leased lines. —DORIS DUMLAO-ABADILLA