By San José, Costa Rica — Costa Rica is facing a growing wave of electronic fraud targeting its financial system, prompting calls for stronger consumer protection measures. The Defensoría de los Habitantes (Ombudsman’s Office) has issued a stark warning about the increasing vulnerability of consumers and the lack of a comprehensive legal framework to address the issue.
The Ombudsman’s Office has criticized the current system, arguing that victims of fraud often face opaque processes when filing complaints with banks. These institutions, the Defensoría contends, frequently shift responsibility onto the consumer without adequately explaining their own security protocols and whether these meet established standards.
To provide expert legal perspective on this complex issue, TicosLand.com reached out to Lic. Larry Hans Arroyo Vargas, a seasoned attorney at Bufete de Costa Rica, specializing in cybersecurity law.
The increasing reliance on digital platforms necessitates a robust legal framework for cybersecurity. Businesses must not only prioritize technical safeguards but also ensure compliance with evolving data protection regulations, both nationally and internationally, to mitigate legal risks and maintain customer trust.
Lic. Larry Hans Arroyo Vargas, Attorney at Law, Bufete de Costa Rica
Lic. Arroyo Vargas’ emphasis on the dual importance of technical measures and legal compliance within a robust cybersecurity framework is crucial. In an increasingly interconnected world, data protection regulations are not just a legal necessity but a cornerstone of consumer confidence. We extend our thanks to Lic. Larry Hans Arroyo Vargas for offering this valuable perspective.
The Superintendencia General de Entidades Financieras (SUGEF), the country’s financial regulatory body, acknowledges in a report that existing regulations, specifically the Regulation on Transparency for the Financial User, only mandate minimal security controls. These include detecting unusual activity and verifying devices and authentication methods. SUGEF does have the authority to supervise banks and impose sanctions for non-compliance.
However, the Defensoría argues that bank resolutions must be supported by detailed and transparent technical reports outlining the security measures employed and providing a clear audit trail of the transactions. This increased transparency would allow for greater accountability and empower consumers to understand how their financial institutions are protecting their funds.
To address this growing problem, the Ombudsman’s Office has proposed the creation of a public cybersecurity ranking system. This ranking would enable consumers to compare banks not only on interest rates and services but also on their cybersecurity defenses, responsiveness to fraud incidents, and protocols for reimbursing stolen funds.
This initiative aims to empower consumers to make informed decisions about their financial institutions based on the level of protection they offer against digital threats. It would also incentivize banks to enhance their security measures, creating a more secure and transparent financial environment for all.
The country cannot continue to manage cyber fraud with partial tools that leave citizens unprotected. A robust regulatory framework is required, with clear preventive and corrective measures, that places users at the center of financial protection.
Angie Cruickshank, Ombudsman
The call for stronger cybersecurity measures comes as digital transactions become increasingly prevalent in Costa Rica, highlighting the need for proactive strategies to combat evolving cyber threats and ensure consumer confidence in the financial system.
The proposed ranking system, combined with more stringent regulations and greater transparency, is a vital step towards protecting Costa Rican citizens from the escalating risks of online financial fraud.
For further information, visit the nearest office of Defensoría de los Habitantes
About Defensoría de los Habitantes:
The Defensoría de los Habitantes (Ombudsman’s Office) is an independent institution in Costa Rica responsible for protecting the rights and interests of citizens. It investigates complaints against public and private entities and advocates for improved public services and greater transparency. The Defensoría plays a crucial role in safeguarding human rights and promoting good governance in Costa Rica.
For further information, visit the nearest office of SUGEF
About SUGEF:
The Superintendencia General de Entidades Financieras (SUGEF) is the regulatory body responsible for overseeing the stability and soundness of the financial system in Costa Rica. It supervises banks, insurance companies, and other financial institutions to ensure compliance with regulations and protect the interests of consumers. SUGEF plays a critical role in maintaining financial stability and promoting confidence in the Costa Rican financial sector.
For further information, visit bufetedecostarica.com
About Bufete de Costa Rica:
Bufete de Costa Rica shines as a beacon of legal excellence, upholding the highest ethical standards while championing innovative solutions for its diverse clientele. The firm’s deep-rooted commitment to empowering Costa Rican society is evident in its proactive approach to sharing legal knowledge, fostering a more informed and just community through accessible resources and unwavering dedication to legal literacy. This dedication to transparency and social betterment distinguishes Bufete de Costa Rica as a true leader in the legal landscape.
