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United Kingdom Crime Security The Almighty Buck

Keep Two Bank Accounts To Beat Cyber Attacks, Says Bank of England Adviser (thestack.com) 172

An anonymous reader writes: Everyone should keep two bank accounts so they can still access their money if one bank is hit by a cyber attack, a former Bank of England adviser has warned. "I'd certainly rather have two [accounts] in case my bank was attacked. I would want to know I could still get money out of the other one," banking expert Peter Hahn said in an interview with BBC's Today, ahead of the Bank of England's latest Financial Stability Report. According to the report, cyber risk is one of the five greatest dangers facing the UK banking industry.
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Keep Two Bank Accounts To Beat Cyber Attacks, Says Bank of England Adviser

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  • by sociocapitalist ( 2471722 ) on Friday December 04, 2015 @06:31AM (#51055691)

    Always keep at least two accounts in two non-related banks in at least two different countries.

    • Isn't it at least 3 accounts in at least 2 different currencies, at least one of which is in another country?
      • Re: (Score:2, Insightful)

        by Anonymous Coward

        Dollars in the bank, euros in your paypal, pesos under the mattress, and rubles in the coffee tin.

      • At present day interest rates you could also stuff some in your mattress.

        Until the internet of things allows them to hack your mattress as well.

        • The Internet of Things will never include the buckets of gold coins and ammunition buried in my back yard.

          No, not really.

    • by AmiMoJo ( 196126 )

      Actually it has long been advisable to have more than one account if you have more than the maximum protected amount. It used to be £35k, but they increased it to IIRC £75k. If you have more than that in an account and the bank goes bust or is robbed, you only get £75k back so you should split your money over a few different banks. It gets more complicated because many banks have the same parent company and the £75k is split between all the child banks.

      • Re:standard (Score:4, Insightful)

        by jellomizer ( 103300 ) on Friday December 04, 2015 @07:03AM (#51055747)

        The US has FDIC which works simularly where in case of robbery or bank closing up to 100k USD will be covered.
        Now most people I know including multi-millionaires don't keep over 100k in the bank. The bank is only good for holding money for high liquidity.

        But for most people having multiple accounts will not make their money any safer as it will just be insured.

        However on the government/insurers point of view having multiple bank accounts means less of a payout on the odd bank collapse.

        • Re: (Score:3, Informative)

          by amberdalan ( 4223833 )
          The standard insurance amount is $250,000 per depositor, per insured bank, for each account ownership category.
          • by cdrudge ( 68377 )

            Even those limits can be worked around. Banks that participate with CDARS [cdars.com] for instance allow you to to effectively have a single account that exceeds the normal insured amount fully protected. The funds automatically get split up among multiple participating banks on the back end.

        • by lucm ( 889690 )

          Now most people I know including multi-millionaires don't keep over 100k in the bank. The bank is only good for holding money for high liquidity.

          You'd be surprised. Call your bank and ask for the interest rate when the balance stays above 100k or even 250k. In many banks this VIP rate beats money market instruments like certificates of deposit.

          This is a good solution in a few situations, such as wealthy senior individuals, who have plenty of other assets and no long term incentive to invest.

          • Call your bank

            Unfortunately, if we're still talking about the UK here, your comment deserves (+5, Funny) for that suggestion alone...

            "We are experiencing very high call volumes and all our agents are busy at the moment. Your call is being held in a queue and you are number three... hundred and... fifty... six... thousand... four... hundred and... ninety seven. Your call is important to us, and we will answer it as soon as possible."

            Later, in a thick, probably Scottish or Indian accent, barely audible: "Hello, my name is

            • by Cederic ( 9623 )

              Unfortunately, if we're still talking about the UK here, your comment deserves (+5, Funny) for that suggestion alone...

              Lets just say that my annual income crossed a very specific threshold and my bank (that I've been with for over twenty years) contacted me to let me know that I'm now a very valued customer; here's a new contact number, here are some additional services we'd like to offer you, here are some benefits we'll grant to you for no fee.

              It's fairly safe to say that someone with over 100k in the bank will get all that and rather a lot more. Banks LIKE money.

          • You'd be surprised. Call your bank and ask for the interest rate when the balance stays above 100k or even 250k. In many banks this VIP rate beats money market instruments like certificates of deposit..

            It definitely does.

    • by jabuzz ( 182671 )

      For most people getting a bank account in two different countries is quite difficult. I would further argue that two different bank accounts is overkill.

      What you need (and what I do) is three different credit cards from completely different suppliers. That is I have one Visa card from one bank and a separate Mastercard from another bank. These live in my wallet. I have a third credit card that lives heat sealed in a draw in an metallized antistatic bag between two sheets of cardboard.

      The idea is that the tw

      • For most people getting a bank account in two different countries is quite difficult.

        Only if you're American as there are some banks that refuse to do anything with Americans now because of draconian requirements such as FATCA.

        Even as an American, it isn't very difficult because Mexico and Canada aren't very far away, not to mention the Caribbean.

        If you have all three cards in one country, per your example, and you have your ID stolen and/or the IRS/Inland Revenue decides your a bad guy (even if you aren't), then you're screwed.

        • For most people getting a bank account in two different countries is quite difficult.

          Only if you're American

          It has become difficult in the UK to get a bank account in the UK. I have had two applications refused in the last year because the version of my address in the database that the bank uses to auto-complete my address when I type it into the application form is different from the version it then looks up in the electoral roll. At another bank the manager only succeeded in opening an account for me by fiddling the computer somehow.

          • by Xest ( 935314 )

            "I have had two applications refused in the last year because the version of my address in the database that the bank uses to auto-complete my address when I type it into the application form is different from the version it then looks up in the electoral roll."

            This seems odd, addresses are broken down into discrete fields in UK credit reference data so unless the bank is doing something really odd then it sounds more like one of these databases (the credit data, or the ER data) has a completely different a

            • You shouldn't really be having problems opening a UK account if you're a UK resident and if you are that does point to either a bad financial history or some invalid data on you that needs correcting somewhere.

              Unfortunately banks seem remarkably incompetent at doing that. My wife and I run a business together, and I have lost track of how often we have physically visited the bank and told the person across the desk that she changed her name when we married several years ago. Every time they say they can't find anything on their system in that name, yet every month they persist in sending statements for one particular aspect of our business banking in her old name. This is literally going to cost them our business

            • This seems odd, addresses are broken down into discrete fields in UK credit reference data

              Stop there. That is the problem - my address does not fit into those fields.

              I live on a country road that has no name. The address I give is House name - Nearest Town [10 miles away] - County - Post code That is how it is in the Electoral Register and in the Royal Mail database too.

              However, when I (or a bank staff member) fill in a computerised application form, the computer insists on a road name or it will not proceed. (As you say, there are discrete fields). So I make a [plausible] road name u

              • by swalve ( 1980968 )
                I would love to have that kind of address. "Rutherford Manor, North Cheswickfordshire, Yarmouth, UK"
      • I would further argue that two different bank accounts is overkill.

        Why? What is your argument? I have several UK bank accounts in order to keep under the 75k guarantee limit - not cheque accounts for ready money but long term investment bonds.

        What you need .. is three different credit cards from completely different suppliers. That is I have one Visa card from one bank and a separate Mastercard from another bank ....

        A bit off-topic (unless it is different where you are), as in the UK at least a credit card is nothing to do with a bank account (although a bank may "front" it). I could get a credit card from my old uni for example. There are bankers in the background of course, but it is not your bank.

        Anyway, you have three credit cards? I

  • by Snotnose ( 212196 ) on Friday December 04, 2015 @06:44AM (#51055713)
    Some 30 years ago the ATMs on the west coast went toes up. Seems a backhoe had dug up a line on the east coast, without that line ATMs didn't work. Doesn't the dumbass bank have redundancies, you ask? Turns out the dug up line was the backup. A week earlier a heavy snowstorm had collapsed the roof of a building that banks needed to run the network.
    I've effectively got 2 banks: a credit union and a stock brokerage account I can pull money out of quickly.
    • by jafiwam ( 310805 )

      Some 30 years ago the ATMs on the west coast went toes up. Seems a backhoe had dug up a line on the east coast, without that line ATMs didn't work. Doesn't the dumbass bank have redundancies, you ask? Turns out the dug up line was the backup. A week earlier a heavy snowstorm had collapsed the roof of a building that banks needed to run the network.

      That was most if not all of the entire US. (Or, a similar outage happened in '88 or so.)

      • I think it was '91/'92. I'd forgotten about it until my earlier post, but I've been remembering the conversations I had with coworkers about it (almost all of the "hey, the money machine is busted. Can I borrow $20?" "Sorry, mines busted too. Can I borrow $10?". I was consulting back then and had jobs for 6-12 months at a time, that narrows it down quite a bit.
        • by creimer ( 824291 )
          The early 1990's were good years for backhoe accidents in Silicon Valley. One fiber optic cable with 50,000+ lines got torn out on three separate occasions by the same backhoe operator at a construction site. After the third repair job, the utility stepped in and did the backhoe work themselves.
  • Would the good gentleman from the Cass Business School, also enlighten us as to where this extra money might be secured?

    This is a perfect example of what happens when people who have more than enough money believe they are communicating with the rest of the world.
    • by Ash-Fox ( 726320 )

      Would the good gentleman from the Cass Business School, also enlighten us as to where this extra money might be secured?

      I'll enlighten you with my own experiences. Innovation is key to a plan to acquire more funds above the average person.

      This is a perfect example of what happens when people who have more than enough money believe they are communicating with the rest of the world.

      You seem to be assuming I am not part of the rest of the world. You're just as guilty of the generalizations you're trying to app

  • by Opportunist ( 166417 ) on Friday December 04, 2015 @07:03AM (#51055749)

    1. Getting bank regulation that deserves that name
    2. Not getting bailed out next time the gambling backfires
    3. A country being able to pay back its debts and thus free to make a move on them
    4. People catching on how things worked out for Iceland and Iceland becoming a role model
    5. Anyone with some clout declaring "this bank is bankrupt". Because that can bankrupt any bank. No matter the size.

    • by Ash-Fox ( 726320 )

      4. People catching on how things worked out for Iceland and Iceland becoming a role model

      This is also what pro EU entities fear.

    • 2. Not getting bailed out next time the gambling backfires

      Okay, this one bothers me. While partially true, its unfair the way you have stated it. The recent #2 is a direct result of #5

      You realize that the bank 'failures' were not because the banks were actually failing, right? Its because the government changed the laws that governed how much of their assets could be out 'on loan' and how much they actually had in cash so that all the loans they had made recently put them in a situation that was illegal.

      It wasn't illegal when they made the deals. The governmen

      • You're not claiming that governments told banks to go on high risk businesses and basically betting their complete financial well being on venues that amount to nothing short of gambling, are you?

  • Requires Money (Score:2, Insightful)

    by Anonymous Coward

    In order to have two bank accounts, one needs to have money. So, Peter Hahn, where do I get all this magic money you speak of? Working full time does not do it. Maybe you could give us all some so we can open multiple bank accounts?

    • Re: (Score:2, Insightful)

      by Anonymous Coward

      The core principle of capitalism is laziness: rather than working, you make money by investing money. Surprisingly, it works better than one might expect, but it's far from perfect.

      This contrasts socialism, which has the core principle that one gets what one needs by actively working. A good dose of socialist principle helps a country, but pure socialism tends to invite corruption.

      (Oddly, the right-wing press swap the two around, and claim that socialism is for the lazy. The point in socialism - which is in

    • by Ash-Fox ( 726320 )

      In order to have two bank accounts, one needs to have money. So, Peter Hahn, where do I get all this magic money you speak of? Working full time does not do it. Maybe you could give us all some so we can open multiple bank accounts?

      I work full time and can spread my money around different accounts just fine. Clearly, you're doing it wrong.

  • Keep zero bank account and invest in a good safe.
    "Cyber attacks" might be among the biggest threats to the banking system, but the banking system is the biggest threat to people's worth.

    • Mice a a vastly bigger risk to your home safe than the banks are to your savings.

      When was the last time someone lost their FDIC insured account balance?

      Go home, buy some gold, and put your tinfoil hat on you nutter.

  • Keeping two or more accounts is good advice for keeping yourself out of trouble if a cyber attack happens, but I don't think this beats them. They still managed to steal your money and disrupt your life.
  • What does it cost for a bank account in the UK? Are they pursuing collecting two monthy fees from each consumer?

    • by Xest ( 935314 )

      Actually it's unlikely this will net the banks any additional profit and will in fact lower profits per-bank. If you stay in credit in the UK then they simply skim the interest paid by the central bank on your proportion of their holdings and pay themselves with that.

      Say for example you had £100 in your account for a year, and central bank interest rates were 3% then they'll just take that £3 as payment. I believe the average rolling holdings in a UK current account is something like

    • What does it cost for a bank account in the UK? Are they pursuing collecting two monthy fees from each consumer?

      It costs nothing. In fact UK banks used to give interest even on cheque accounts (but no more)

      Having said that, some banks have "Gold" accounts (or some such name) which do charge a fee in return for allowing a bigger overdraft or "personal attention" from the manager whatever that involves. I pay no fees, don't need personal attention, never need an overdraft, but am constantly bombarded with hype urging me to "upgrade" to a "gold" account. My banks also have a Byzantine system of fees for stuff like

  • What's wrong with cash? Or is that too independent / liberty-y for the brits? Using two banks just doubles your risks of card / account / user/pass getting stolen.

    If you go the "two banks" route, check which core processor they use for their accounting first. In the US, there are about 5 companies that smaller institutions use to run their account and transaction data. If the breach is one of the core processors, you don't want to have your two redundant banks on the same processor.

    Of all the things

    • by Xest ( 935314 )

      "What's wrong with cash? Or is that too independent / liberty-y for the brits? Using two banks just doubles your risks of card / account / user/pass getting stolen."

      You wont get interest paid on cash held, so it'll lose value over time compared to that held in a savings account.

      In the UK, having your banking details stolen is not too big a deal. Unless the bank can prove you were seriously negligent (which they basically have never been able to do unless you really did something stupid like posted your plai

  • Isn't this the same as raid for disk storage?
    You run multiple disks spreading and duplicating data so that your availability is higher in case one (or more) disk(s) goes down.
    For every disk you add, the chance that something will happen goes up, but the chance of you recovering your data can go up as well.

    For your bank account I claim the same to be true. Two banks with different systems double the chance of you experiencing one that has a break-in.
    Each bank may have different systems leading to differ
  • by Dunbal ( 464142 ) * on Friday December 04, 2015 @09:36AM (#51056201)
    But wouldn't that make you twice as likely to be attacked?
  • Let them eat cake (Score:4, Insightful)

    by devnullkac ( 223246 ) on Friday December 04, 2015 @09:40AM (#51056215) Homepage

    Typical advice from an out-of-touch banker. This is impractical for those most at risk of serious consequences if their bank closes for a few days. It's not like getting an extra hard drive and copying your money to the backup bank. You have to split your limited assets and make sure you meet the minimum requirements of two institutions. And heaven help you if each requires you to have direct deposit in order to avoid monthly fees.

    • by Xest ( 935314 )

      "You have to split your limited assets and make sure you meet the minimum requirements of two institutions."

      Those requirements are hardly difficult to achieve though. The government has an agreement with banks such that even homeless people can get basic bank accounts (with no frills things like overdrafts excluded) - this was to allow the government to pay welfare digitally rather than have to maintain a process of having to provide, manage, and secure, cash handouts.

      Basically anyone in the UK should be ab

  • I'm an American, I don't hand any money in my bank account. Take that Cyber Criminals!
  • Would assume that everyone has enough money to fund two bank accounts to the the level necessary to keep them solvent in the event of the inaccessibility of one of them ... must be nice to have that kind of money available.
    • by creimer ( 824291 )
      My biweekly paycheck is direct deposited into three accounts: $10 into a prepaid debit card for laundry, $100 into an online savings account, and the net balance into a credit union checking account. The only time I remember about the money in the online savings account is when I'm reviewing the monthly statements.
  • I have one account with fiat money, one with Bitcoins.

    And one with Dogecoins, one with Litecoins, etc.

  • I am completely insulated from cyber banking attacks, I don't need to spread my risk across 2 bank accounts, because 0 + 0 = 0
  • That advice seems really great for people that have tons of disposable income where they can split their assets like that. Meanwhile, the 75% or so of the populace that's living paycheck to paycheck is going to take one look at that and be like yeah...no. If you're barely making enough to pay the bills how are you supposed to fork your assets into two different accounts like that?
  • by j2.718ff ( 2441884 ) on Friday December 04, 2015 @01:07PM (#51057651)

    There have been times when I've had multiple bank accounts. However, eventually, one bank ended up buying the other, leaving me with two accounts at the same bank.

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