Financial Services Providers Remain a Big Target of Security Intruders

Some time ago we examined the key cyber security issues and challenges facing a number of industries. Things change fast in the security arena, so we thought it would make sense to provide an updated look at some of these sectors.

Over the coming months, these posts will zero in on the threat vectors and vulnerabilities that specific industries are facing. To kick things off we’re focusing on the financial services sector, a favorite target of many hackers and other cyber criminals.

The networks and systems operated by banks and other finance businesses have long been the object of intruders’ desires—and that hasn’t changed as demonstrated by events of the past few months and the industry’s reaction.

For example, in May 2016 the Society for Worldwide Interbank Financial Telecommunication (SWIFT), a Brussels-based cooperative society owned by thousands of financial institutions, told customers it was aware of fraudulent payment cases in which some customers suffered a breach in their local payment infrastructure.

SWIFT noted that its own network, services and software were not compromised. But it cited specific measures that its finance customers need to take to ensure that the community is “using its collective force to reduce the risk of cyber intrusions.”

The society urged customers to share relevant cyber information among other members. To improve information sharing, as a first step the society said it will be centralizing all new and existing security information in its online Knowledge Base. SWIFT said it will update the resource with relevant information, including any new customer malware or other indicators of compromise (IOCs). It recommended that customers’ IT security teams review the information on an ongoing basis.

“The security of our global financial community can only be ensured through a collaborative approach among SWIFT, its users, its central bank overseers and third-party suppliers,” the message to customers said. “It is essential that you share critical security information related to SWIFT with us.”

These types of efforts are likely to become more common as firms face a barrage of security threats and data breaches, including attacks that exploit newer technology tools. One recent example is an attack in which hackers stole millions of dollars from ATMs using just their smartphones.

According to online publication The Register, cyber criminals managed to trick a network of bank ATMs in Taiwan into dispensing the cash. Police suspect that two Russian nationals cashed out dozens of ATMs operated by Taiwan's First Bank, stealing an estimated $2.2 million. The Register said the cyber criminals appeared to gain control of the machines with a connected device, possibly a smartphone, according to police.

As attacks continue to escalate, “forward-leaning financial services firms are beginning to leverage and link innovative cyber security tools, many of them cloud-enabled,” notes consulting firm PwC in its report, “The Global State of Information Security Survey 2016.”

These firms are improving their security programs with technologies such as cloud-based cyber security services, big data analytics and advanced authentication and biometrics.

Financial services respondents to the PwC survey ranked the assessment of security capabilities of third-party vendors as the top challenge to their information security efforts. More than half of those surveyed said they would increase spending to better monitor third-party security in the coming 12 months.

Some are improving third-party cooperation through the use of risk-based security frameworks, which PwC says can also help companies more easily exchange information with third-party business partners and suppliers, and communicate expectations and concerns about services that are being provided.

Mobile technology has added to the risk considerations, as evidenced by the ATM hack in Taiwan. The use of mobile devices and apps for consumer banking has exploded worldwide, the PwC report notes. “To secure those interactions, financial services respondents say mobile device security is a leading spending priority,” the report says. One way financial services firms are addressing the rise in mobile risks is through the use of advanced authentication tools.

And while financial services firms have long had to deal with sophisticated attackers, some of the PwC respondents cited a trend of certain bad actors apparently working together to carry out attacks. “Perhaps even more menacing, some financial services executives believe that organized crime and foreign nation-states are joining forces to perpetrate cybercrime,” the report says.

Many companies in the industry are fighting back against threats by using big data and analytics technologies to monitor for covert activities. Doing this has helped them better understand evolving external and internal security risks, as well as better monitor user behavior and network activity, the PwC report says.