The Federal Deposit Insurance Corp. (FDIC) Friday issued a list of best practices for financial services firms that details how to protect against spyware, which the agency said can be used by criminals to collect customer data or hack into banking systems.

"It is critical that banks stay vigilant about the risks involved with this malicious software and take appropriate action so that they and their customers do not fall victim to it," said Michael Zamorski, director of the FDIC"s Division of Supervision and Consumer Protection.

The guidance spells out the risks associated with spyware and recommends actions that financial institutions can take to mitigate those risks on internal computers as well as on those used by customers to connect to transactional banking Web sites.

The FDIC recommends rolling out multifactor authentication to limit the ability of identity thieves to access customer accounts. Firms should also consider spyware as part of their risk-assessment analysis and bolster security against it by setting Internet-use policies for employees. The FDIC also recommends that banks advise customers on the risks of using public computers such as those in hotels, libraries or Internet cafes to connect to online banking Web sites because of the uncertainty of what spyware may have been installed on the public equipment.

According to the FDIC, the risks associated with spyware include allowing attackers to eavesdrop and intercept sensitive communications, such as customer IDs and passwords; allowing unauthorized access to user accounts; permitting unauthorized access to bank systems; and increasing vulnerability to other Internet-based attacks, such as phishing.