The financial sector has, for three years in a row, been cyber criminals’ favourite target. In 2018, it was the victim of 19% of all recorded cyber attacks and incidents. In the light of the increasing value of customer data and the large digital transactions that hackers can intercept, state actors and independent criminals alike see rich pickings in focusing on the financial sector. In response, firms are investing vast sums of money to make themselves more secure.

Examples of cybercrime

In 2017 a series of cyber attacks using the WannaCry ransomware, a virus that encrypts user data that is then released following payment, affected manifold systems across the globe. The total cost of these attacks is believed to have exceeded $1bn. The NotPetya virus followed, wiping data records of targeted systems of many organisations, which cost shipping operator Maersk almost $300m in revenue. Both attacks were suspected to be state sponsored.

Other cyber attacks on critical infrastructure include the disabling of an Iranian nuclear power plant in 2010 and power outages in Ukraine in 2015 following a supervisory control and data acquisition attack. Between 2015-16, a North Korean group hacked Swift payment systems and stole more than $100m from unauthorised payment messages.

The ability of governments to effectively confront these threats depends on robust collaboration in the international community. But to date the regulatory landscape has been fragmented, with limited guidance around response and recovery beyond basic principles. Firm-specific strategies to nullify cyber attacks have included custom detection, response and recovery methods. Individual government-led national strategies, without international collaboration, have increased the divergence of cybersecurity approaches.

This was taken from OMFIF’s fourth quarter edition of The Bulletin, focusing on the theme of cybersecurity in the financial system. Click here to read the full version.