South Korea's Problems Worsen. Could China Be Next?

Earlier this week several banks in South Korea suffered computer crashes which shut down their operations, including their ATM networks. Unsurprisingly, many people jumped to the conclusion that North Korea had authored these attacks as a warning to South Korea not to engage in practice military maneuvers with the US military aimed at preparing for actions against North Korea. Then it was reported that the offending computer signals which started this disaster originated from computers in China.

This weekend the computer disaster in South Korea worsens, but the attribution for its origins has changed. As the conservative Japanese news source Sankei reports, the computer attack against the banks seems to have come from domestic South Korean computers, from those of an agriculture cooperative, it seems. The South Korean government has gone as far as to apologize to China for the now-discredited reports of the attacks' Chinese origins.

While investigations to find the culprit continue, the disaster's effects spread. The VISA bank card network has ceased operating in South Korea, and perhaps hundreds of thousands of South Korean depositors have had their bank deposits either vaporized or frozen for months.

To date, investigations have not concluded whether the computer disaster is the product of domestic or foreign agents, or accident. All that can be determined with certainty is that bootleg computer programs made the banking system vulnerable. Bootleg programs are usually significantly less expensive than their authorized models. But as time goes on, bootleg programs are rarely updated to protect against new and evolving threats, while their pricey authorized peers keep up-to-date.

Whether today's bank disaster spreads to the South Korean military is up for grabs. Microsoft has been trying without success since 2003 to get the South Koreans military to pay for and update their core computer systems.

Whatever else can be learned from these recent events, going cheap can be a terrible gamble. Many computer users who thought they were getting away with deception now have to worry how vulnerable they are. While it might not be the source of today's crash, it is well known that China is perhaps the world capital of computer bootlegging. It could be that the same methods which brought down South Korean banks can be used against Chinese institutions using outdated fake stuff.

By the way, it might be worth a few moments to call your financial institutions to ask what computer programs they employ. Perhaps it can happen here too.

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