Philippine central bank probes hacking complaints at banks

[MANILA] The Philippine central bank is looking into complaints that some clients of BDO Unibank, the country's largest lender by assets, lost money to an online fraud in which funds were channelled to accounts at Union Bank of the Philippines (UBP).

"We are in close coordination with BDO as well as UBP on this incident to ensure that remedial measures are being undertaken, including reimbursement of affected consumers," central bank governor Benjamin Diokno said in a statement on Sunday (Dec 12). The regulator has been monitoring a surge in complaints posted via social media since the early part of this week, he said.

BDO is aware of a "sophisticated fraud technique" that has affected some of its clients, the bank said in a statement. "We have already implemented additional security controls to block further attempts and continue to protect bank credentials," it said.

Bank president Nestor Tan told the Philippine Daily Inquirer that the incident "affects a 10-year old web service that is for phase out" and that a replacement should be available early next year.

UnionBank froze several accounts that received money from BDO accounts, president Edwin Bautista said. "We will not hesitate to take legal action against individuals who use their accounts to facilitate criminal activities," he said.

One of the accounts used 5 million pesos (S$135,491) of stolen funds to buy Bitcoin on Dec 11, according to a Manila Bulletin report that cited an unidentified source.

BLOOMBERG