INTERCOMPUTER CORPORATION GRANTED SECOND MOBILE BANKING PATENT

May 23rd, 2013

Latest Patent Covers Risk-free Digital Banking Platform

Fullerton, CA, May 21, 2013: InterComputer Corporation announced today that the US Patent Office has issued it a new patent that covers the core technologies of an insured, risk-free digital banking platform.

The patent for invention number 8,380,622 covers secure electronic payments with reconcilable finality.

“This latest patent makes claims in connection with our technologies that enable the electronic exchange of money and high-value information in a risk-free, fully insured environment,” said Scott M. Volmar, President and CEO of InterComputer Corporation. “It complements the Australian patent issued in 2012 for our personal secure interface device.”

The patent covers a comprehensive electronic payment mechanism connecting a buyer, a seller, and their respective banks to routinely execute transactions in 15 seconds or less with legal finality and immediate funds availability. The system employs proprietary advanced electronic identity management, including both authorization and delegation functions, along with abuse prevention, abuse detection/management and continuous audit technologies.


patent

“Our patented technologies, usable over a standard Internet connection, enable us to drive the residual risk in the system down to a minimal level where we are able to obtain underwritten insurance coverage to protect all parties against hacking, phishing, malware insertion or any other kind of cybercrime,” Volmar said. “This means that all users of insured InterComputer systems have loss damage recovery for the full face amount of the transaction, plus lost business, and even third party liability.”

Cybercrime is driving both commercial and consumer demand for truly safe electronic banking to unprecedented levels.

“Simply granting electronic access to legacy banking systems via inherently unsafe means, such as the https protocol, has not stopped cybercrime losses,” said Volmar. “Banks are scrambling to avoid liability while retaining customer satisfaction and loyalty. We think InterComputer’s fully insured digital banking platform will fully protect both banks and their customers while driving transaction costs down dramatically.”

About InterComputer Corporation

InterComputer Corporation develops and markets technology solutions that provide risk-free, Internet-based electronic transaction systems in multiple enterprise verticals (banking, healthcare, government agencies, etc.). InterComputer is a privately held Delaware corporation headquartered in Fullerton, CA.

Statement under the Private Securities Litigation Reform Act

With the exception of the historical information contained in this release, the matters described herein contain forward-looking statements that involve risk and uncertainties that may individually or mutually impact the matters herein described, including but not limited to, product acceptance, the ability to continually obtained increased orders of its products, the ability to meet installation goals, economic, competitive, governmental impacts, whether pending patents will be granted or defendable, validity of intellectual property and patents, the ability to license patents, the ability to commercialize developmental products, as well as technological and/or other factors.

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FORMER SENIOR CIA OFFICER EXPLAINS “THE REAL CYBER THREAT”

May 22nd, 2013

A former senior CIA officer says that cyber doomsday scenarios involving attacks on physical infrastructure are far less critical than potential cyber attacks on the U.S. banking industry.

In a recent CNN article, Mark Sparkman sums up the scope of the cyber threat to U.S. banks succinctly: “Want real chaos? Destroy confidence in the banking system (or even part of it), and just stand back and watch.”

Sparkman is a former senior officer with the CIA’s National Clandestine Service is currently a senior international affairs analyst with RAND Corporation. In the article, he notes that the nation has repeatedly shown the ability to bounce back from natural disasters that disrupt physical infrastructure and utility services. He is not so hopeful about recovering from a serious offensive cyber attack on the banking industry.

“The banking system is built on trust. It’s slow to establish and fragile to keep. That trust must be fiercely protected,” says Sparkman. “All bets are off…in a true offensive cyber attack. Protected data would be changed, manipulated, or destroyed, and depositors might never recover their assets. With the possibility of such an attack looming, governments should be making serious decisions about deterrence, defense, retaliation, and escalation.”

Read the entire article here.

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INTERCOMPUTER CORPORATION MAKES MOBILE BANKING INSURABLE

May 17th, 2013

Patented Technologies Enable Unique Underwritten Transaction Coverage

Fullerton, CA, May 17, 2013: InterComputer Corporation announced today that its past and potential underwriters have confirmed that its mobile banking technology is insurable in the U.S. and worldwide market.

InterComputer’s unique digital banking insurance coverage is the result of an exhaustive 12-month review by several syndicates from Lloyd’s of London, in which InterComputer’s technologies were risk-evaluated by underwriters and their network security experts. “I am happy to confirm that Lloyd’s and several US based insurance markets have confirmed the ability to insure InterComputer’s web and mobile-based digital banking systems, ,” said Michael Daigle, President and CEO of DataRisk LLC.

“Our technologies enable the electronic exchange of money and high-value information in a risk-free, insured environment,” said Scott M. Volmar, President and CEO of InterComputer Corporation. “This means that mobile banking users can transact their business under a comprehensive umbrella of insured security without fear of cybercrime losses.”

InterComputer’s insured digital banking systems can connect a buyer, a seller, and their respective banks in real-time. The system employs proprietary advanced electronic identity management, including both authorization and delegation functions, along with abuse prevention, abuse detection/management and continuous audit technologies. In addition, the system allows banks to settle transaction in real-time with legal finality.

“Our patented technologies, usable over a standard Internet or mobile phone connection, enable us to drive the residual risk in the system down to a minimal level where we are able to obtain underwritten insurance coverage to protect all parties against hacking, phishing, malware insertion or various other kinds of cybercrime,” Volmar said. “This means that users of InterComputer systems have the ability to recover loss damage recovery for the amount of the transaction, plus lost business, and even third party liability.”
Cybercrime is driving both commercial and consumer demand for truly safe electronic banking to unprecedented levels.

“Simply granting electronic access to legacy banking systems via inherently unsafe means, such as the https protocol, has not stopped cybercrime losses,” said Volmar. “Banks are scrambling to avoid liability while retaining customer satisfaction and loyalty. We think InterComputer’s fully insured digital mobile banking platform will fully protect both banks and their customers while driving transaction costs down dramatically.”


insurancepolicy

About InterComputer Corporation

InterComputer Corporation develops and markets technology solutions that provide risk-free, Internet-based electronic transaction systems in multiple enterprise verticals (banking, healthcare, government agencies, etc.). InterComputer is a privately held Delaware corporation headquartered in Fullerton, CA.

Statement under the Private Securities Litigation Reform Act

With the exception of the historical information contained in this release, the matters described herein contain forward-looking statements that involve risk and uncertainties that may individually or mutually impact the matters herein described, including but not limited to, product acceptance, the ability to continually obtained increased orders of its products, the ability to meet installation goals, economic, competitive, governmental impacts, whether pending patents will be granted or defendable, validity of intellectual property and patents, the ability to license patents, the ability to commercialize developmental products, as well as technological and/or other factors.

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TWO BANKS HIT FOR $45 MILLION BY CYBERTHIEVES

May 10th, 2013

One of the biggest bank heists in history spans 27 countries and proves the major threat cybercrime has become to banks around the world.

The U.S. Justice Dept. just announced the arrest of eight men in the New York cell of the conspiracy, which began with the hack of a UAE bank (RAKBANK) in December 2012. This was followed by a hack into the Bank of Muscat in Oman in February 2013.


(Image from one thief's cell phone)

(Image from one thief's cell phone)


The hacks allowed cyberthieves to fraudulently increase the available balances and ignore the preset withdrawal limits on prepaid Mastercard debit cards. Multiple cards were then distributed to conspirators in 24 countries, who used them in a massive, coordinated “attack” on February 19 by withdrawing cash from ATMs. The thieves raked in $40 million in just over 10 hours through 36,000 fraudulent transactions.


ATMcard

“InterComputer’s TMOB Solution is designed to prevent the possibility of such attacks,” said Scott Volmar, president of InterComputer Corp. “In particular, our Corporate and individual identity and authority management technologies deliver guaranteed, granular, auditable control of user authorities and limits. The entire InterComputer solution comes with comprehensive transaction insurance that would have enabled the victimized banks to recover their losses had they employed our insured system.”

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CYBERTHIEVES HIT FUEL DISTRIBUTOR FOR $800,000

May 5th, 2013

A North Carolina fuel distribution company had a very bad May Day this year when crooks began a cybertheft that went undetected for five full days, costing the company over $800,000 total.

Hackers used the ACH system to send sub-$10K amounts to more than 60 “money mules”, individuals who often act as middlemen for eastern European gangs.

All told, the theft amounts to more than one year’s payroll for the victimized company.

Peoples Bancorp of North Carolina had just upgraded its security system during the month prior to the theft, but has apparently refused to comment.


cyberthief

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COURT FINDS BANK LIABLE IN CYBERTHEFT

June 22nd, 2011

Internet Banking Theft

In a potential watershed case, A Michigan court has found Dallas-based Comerica Bank liable for over half a million dollars in fraudulent wire transfers executed by cyberthieves.

The thieves used stolen electronic banking credentials to wire over $1.9 million out of the accounts of Experi-Metal Inc., a custom metals shop that sells stamped parts to the automotive industry. The bank was able to reverse or otherwise recover $1.34 million from the fraudulent transfers, leaving Experi-Metal with a loss of over $560,000.

Unlike other cases of this type heretofore, the judge has found the bank to be liable for the unrecovered fraudulent transfers, but for reasons not pertaining to the level of their electronic banking security technology. In this case, 97 individual wire transfers were made within a five-hour period, many to bank accounts in Russia and Estonia. The basis of the judges ruling was that the bank had failed to deal with its customer in “good faith”, saying, “A bank dealing fairly with its customer, under these circumstances, would have detected and/or stopped the fraudulent wire activity earlier.” You may read the judge’s entire opinion here.

Though the judge has yet to determine how much Comerica will have to pay, the case has raised eyebrows within the cyberlaw community because of its potential to set a very important precedent. If the ruling stands on appeal, banks will almost certainly act strongly to limit as much as possible their liability in such cases.

InterComputer’s Trusted Banking solution is designed expressly to prevent the compromise of electronic identities and communications between banks and their clients, and insure against losses from cybercrime of any kind.

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COURTS FAVORING BANKS IN CYBERCRIME LAWSUITS

June 8th, 2011

cyberjustice

In one of several closely watched cases around the country, a district court in Maine has received a recommendation from a magistrate that, if adopted, will make it more difficult for businesses who are victims of on-line banking cybercrime to sue their bank for having inadequate electronic security measures.

Patco Construction Co. of Sanford, Maine was hit by cyberthieves for $588,000 in fraudulent wire transfers after those thieves stole the company’s online banking credentials using a “Trojan horse” malware application. Ocean Bank successfully blocked or reversed over $243,000 of the fraudulent transfers, but Patco’s net loss was still over $345,000. The bank then took most of the remaining money in Patco’s account to cover the unmitigated fraudulent transfers.

Patco sued the bank for providing inadequate security measures for its on-line banking services, which allowed thieves to access Patco’s accounts using little more than a username and password.

The magistrate’s recommendation to the court, received on May 27, 2011, would deny Patco’s motion for a summary judgment in their favor. Such a ruling would give tacit approval to the notion that username/password security (also known in the industry as “two-factor security”) is legally adequate to protect banks from losses when their online banking systems are breached.

To learn more about the critical differences between two-factor and three-factor security, click here.

To learn more about the Patco vs. Ocean Bank case, click here.

InterComputer’s Trusted Banking solution is designed expressly to prevent the compromise of electronic identities and communications between banks and their clients, and insure against losses from cybercrime of any kind.

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FBI GROUP ON CYBERCRIME: “WE’RE LOSING THE BATTLE”

September 29th, 2010

cyber-criminal

“The criminals are absolutely ripping us to shreds. We’re not even slowing them down. We’re losing the battle. That’s the reality of it.”

Strong words from Chris Mark of ProPay, spoken at a recent meeting of Infragard, and FBI program connecting businesses with federal and local crime agencies.

Business owners were told that the ” online harvesting” of credit card numbers and other transaction data is exploding in scale. Mark went on to say that organized criminal enterprises from foreign countries, mostly in Eastern Europe, have the resources to defeat nearly every cyber-protection businesses have put in place. This is true even for businesses who specialize in providing payment services to other businesses.

The cyber criminals are so confident of their ability to steal at will that they have even attempted to extort “protection money” from some payment processing companies, such as ProPay.

At the Infragard meeting, Special Agent Jim McTighe (who runs the FBI’s Salt Lake City office) was heard to say, “Frankly, I think my days of on-line banking are over.”

The need for InterComputer’s comprehensive, insured on-line transaction solutions is greater than ever and growing fast.

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ELECTRONIC MEDICAL RECORD THEFT RISES

September 13th, 2010

EMR

A recent report jointly issued by the United States Secret Service and the Verizon Business RISK team states that cyber attacks on medical record systems increased substantially in 2009, and will probably continue to increase in the future.

Recent data from the Office for Civil Rights of the federal Health and Human Services Department shows that in 2010 to date, over 150 health care entities have reported EMR breaches affecting more that 4 million patients altogether.

The Secret Service/Verizon report lists a number of causes for hundreds of breach events, ranging from external hacking to social tactics to internal fraud and abuse. The number one cause of all data breaches? Stolen credentials. InterComputer’s core technologies, including patent-pending electronic identity and role/authority provisioning, eliminate the problem of stolen credentials.

InterComputer’s Secure EMR Exchange solution systematically eliminates those causes and delivers automated regulatory and legal protection for hospitals, doctors, and insurers. This solution is the only solution carrying underwritten insurance coverage in case of any system malfunction or cybercrime.

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E-BANDITS HIT CA ESCROW COMPANY FOR NEARLY HALF A MILLION DOLLARS

July 27th, 2010

in-escrow-sign3

Redondo Beach-based firm Village View Escrow was recently hit for $465,000 by thieves who hijacked the company’s bank account electronically.

The cyber-thieves sent a fraudulent e-mail to the owner and to her assistant. Both women opened the e-mail, which secretly released a password-stealing virus onto their respective computers. Armed with the banking login information for both women, the hackers deactivated the customary advisory service and used the requisite two login credentials to issue electronic instructions to the escrow company’s bank to wire out various amounts of money to various other accounts. In total, 26 wire transfers were ordered, all of which were executed because of the two (apparently) legitimate login credentials. No confirming advisory messages for each transfer were sent to the escrow company because the cyber-thieves had disabled that notification feature using the stolen login credentials.

Some 20 individuals around the world received the wired money and re-transmitted it to the cyber-thieves after withholding a portion as payment for their services. Such intermediaries are known in the business as “mules”, and are often clueless about the criminal nature of their involvement in the scheme.

Working frantically after the theft was discovered, the escrow company owner managed to get $70,000 of the fraudulent wire transfers reversed. That left a $395,000 shortfall which the bank will not reimburse. The escrow owner had to take a loan to cover the shortfall at 12%, and can not even draw a salary as she tries to put the company back on its feet.

Several of the features built into InterComputer’s Trusted Banking solution would have stopped the illicit use of legitimate banking credentials before any wire transfers could have been ordered by the cyber-thieves.

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