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HACKING FOR PROFIT

aged thirty-six, was sentenced to twenty-seven months in prison by a judge in the US District Court in Chicago. It was one of the most severe sentences ever given to a computer hacker in the United States.⁶

A US gangster was once asked why he robbed banks. 'Because that's where the money is,' he replied.

Little has changed. Banks still have the money. The means of robbing them, however, have become more numerous since the Thirties, when the sawn-off shotgun ruled. Modern banks are dependent on computer technology, creating new opportunities for fraud and high-tech bank robbery.

Probably the best-known story about modern-day bank fraud involves the computation of 'rounded-off' interest payments. A bank employee noticed that the quarterly interest payments on the millions of savings accounts held by the bank were worked out to four decimal points, then rounded up or down. Anything above .0075 of a dollar was rounded up to the next cent and paid to the client; anything below that was rounded down and kept by the bank. In other words, anything up to three-quarters of a cent in earned interest on millions of accounts was going back into the bank's coffers.

Interest earned by savers was calculated and credited by computer. It was a simple matter for the bank employee to write a program amending the process: instead of the rounded down interest going back to the bank, it was all amalgamated together in one account, to which the employee alone had access. Over the two or three years the scam was said to have been operational, the employee was supposed to have grossed millions, even billions. All from collecting the rounded-down portion of the interest due to savings account holders.

The story is an urban legend which has been told for years, and has been accepted by many – but there has never been a single documented case. It is believed because it certainly could be true: the banks' dependence on computers has made fraud easier to commit and harder to detect. Computers are impersonal, their procedures faster and more anonymous than paper-based transactions. They can move money around the world in micro-seconds; accounts can be created and hidden in the twinkling of a computer keyboard.

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