Ireland not hit in Tesco hack

None of Tesco’s 30,000 or so financial services customers on the island of Ireland have been affected by the weekend fraud attack on the supermarket giant’s banking operations.

The cyber attack targeted 40,000 current account holders in the UK.

Tesco Bank’s customers in Ireland — of which there are 27,000 in the Republic — avail of credit card services only and were totally unaffected.

The banking arm of Britain’s biggest retailer was yesterday scrambling to deal with the online attack on 40,000 customers’ accounts, 20,000 of which had money removed.

The hack is the first on a British bank known to have resulted in customers losing money, adding to growing concerns about the UK financial sector’s vulnerabilities to cyber attacks, which have jumped in frequency over the past two years.

Tesco Bank, which manages 136,000 current accounts, stopped all online transactions while it worked to resume normal service, although customers could still use their bank cards in shops and to withdraw money from cash machines.

“Any financial loss that results from this fraudulent activity will be borne by the bank,” said Tesco Bank chief executive Benny Higgins, adding that “customers are not at financial risk.”

“We think it would be relatively small amounts that have come out but we’re still working on that,” he said, adding that he expected the cost of refunding customers would be “a big number but not a huge number”.

The bank is a minnow in Britain’s retail banking market, with about 2% of current accounts, and represents only a small part of Tesco’s overall business.

It contributed £503m (€565m) to the group’s revenue of £24.4bn in the first half of its 2016-17 financial year. Tesco’s share price was down around 1% yesterday.

However, while the financial hit to the group may be limited, Tesco Bank risks serious reputational damage from an attack that affected 29% of its customer current accounts.

Other British banks have been targeted by cyber attacks in recent years, but the Financial Conduct Authority (FCA), which regulates the sector, said it was not aware of any previous incident in which customers had lost money.

Reported attacks on financial institutions in Britain have risen from just five in 2014 to over 75 so far this year, according to FCA data.

Additional reporting by Reuters