Authorities Blame IT Vendor After Jakarta Bank Loses Rp 50b in ATM Fraud
Jakarta. The Financial Services Authority (OJK) said poor software installation at Bank DKI’s network system had caused the Jakarta government-owned bank to lose around Rp 50 billion ($3.5 million) in a recent scandal involving municipal police officers.
An OJK deputy chairman said the agency had instructed the bank to solve the issue and that the IT vendor had claimed responsibility for the faulty.
Because of the software faulty, officers who withdrew cash from ATMs belonging to another bank saw the balance unchanged. They then repeated the withdrawals over and over again.
The Jakarta Police have named 13 Jakarta Municipal Police officers as suspects for fraud by misusing their Bank DKI cards.
"This is very technical. The ATM at another bank couldn’t detect the withdrawal so the person who had cashed in saw his balance remained the same. It’s about the coding system and the IT vendor is the one to blame,” Slamet Edy Purnomo, OJK deputy for banking supervision, was quoted by Antara news agency as saying on Friday.
He didn’t name the vendor and the bank whose ATMs had been misused by the officers.
Bank DKI involved the vendor when it began upgrading its ‘core banking system’ in January, but apparently the contractor had failed to properly install the inter-bank switching system, he said.
"It’s strange that the failure occurred only at ATMs of that particular private bank,” he said.
"We encourage all banks to get verification by the government’s compliance and risk management team when developing a service system.”
Separately speaking, Jakarta Police’s director of special crime unit Chief Comr. Iwan Kurniawan said the suspects had withdrawn between Rp 22 million and Rp18 billion. He said dozens of witnesses had been questioned by his men in the case.