According to David Nelson, examination specialist at the FDIC, online banking fraud involving the transfer of funds rose to more than $120 million in the third quarter of 2009.

"The FDIC receives a variety of confidential reports from financial institutions, which allow it to generate the estimates, Nelson said," writes PCWorld's Robert McMillan.

"Almost all of the incidents reported to the FDIC 'related to malware on online banking customers' PCs,' he said," McMillan writes. "Typically a victim is tricked into visiting a malicious Web site or downloading a Trojan horse program that gives hackers access to their banking passwords. Money is then transferred out of the account using the Automated Clearing House (ACH) system that banks use to process payments between institutions."

Click here to read the PCWorld article.