Morgan Stanley today admitted that they are the latest online banking operation to have discovered a serious security flaw in its systems, which allowed customers to access account details of other clients.

The revelation follows last week's report that Cahoot, Abbey National's online bank, had discovered a similar flaw, which it described as a "glitch", and similar reports about online security problems involving the practice of "phishing".

The latest instance is of greater concern, since users were able to enter other accounts by entering just the first digit of a credit card number.

The shortcut would only work if the account holder had set up the computer to automatically save passwords.

This autocomplete system should not work on secure financial sites, according to guidelines issued by the Association for Payment Clearing Services (Apacs), the body that oversees the banking payments system. Morgan Stanley has now disabled the facility.

"Security violations certainly aren't limited to Internet banks - they affect all banks which conduct transactions over the web," Chris Fedde, a senior vice-president of the enterprise division at SafeNet, an internet security company. "The worrying thing is that breaches happen on an alarmingly frequent basis."

Mr Fedde described the latest incidents as a "mistake". "All banks can do is select security products and test, test, test to ensure their networks don't have any weak spots.

"Internet banks are complicated, because customers are invited into the heart of the technology. Banks need to ensure that users can access only the areas they have authority to."

Security experts last month accused high street banks of shirking their responsibility to make internet banking secure after it emerged that online bank customers had lost £4.5 million to fraud in the nine months to September.

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