Banking officials and computer security experts predicted the wave of cyber scams targeting the financial services sector will soar in 2004 as the industry braces for a new onslaught of fraud schemes.

The gloomy prediction comes amid a string of e-mail and website spoofing scams preying on banking customers.

Police call the relatively new phenomenon "phishing", so named because fraudsters try to lure unwitting customers into divulging their bank details.

In the past few months, a rash of e-mails posing as correspondence from some of the world's biggest banks have flowed into various e-mail in-boxes. The scams have been reported in Britain, the United States and Australia, to name a few.

"We see phishing as just the toe in the water," said a security expert for one of the UK's largest banks who spoke on condition of anonymity at a summit in London dedicated to security matters in the financial services industry.

"It's like credit card fraud. Phishing is not big yet. But it will be."

Banks, desperate to protect their reputation and preserve a fast-growing segment of their business, consider online fraud schemes a top security issue.

"The level of concern among our customers about the risk is certainly on the increase," said Nick Sears, vice president of sales for Finjan Software, a California-based security firm that counts some large banks as its customers.

British banks have been particularly hard hit this fall with more than a half-dozen firms, including Barclays Plc, Lloyds TSB and NatWest, posting warnings to customers that they have been the target of fraudsters.

At the summit, industry officials sounded a sobering note that technological advances will do little to halt the crime wave.

Instead, they said, the best defence lies with the customer.

"At the end of the day, the customer has got to start being more aware of what they're doing online. If somebody came up to you on the street and asked you for your credit card, you're not going to give it away. Why would you listen to an e-mail?", the bank security expert said.

Police blame the crime wave on organised crime syndicates based in Eastern Europe and other regions where law enforcement is ill-equipped to investigate the cases.