February 05, 2016//Ellen NeveuxLast Updated: April 09, 2021
In its second service outage in the month of January, Europe’s largest lender, HSBC, was the target of a distributed denial of service (DDoS) cyber attack that took HSBC offline to consumer and commercial interests in the United Kingdom.
As a global financial interest, HSBC has a history of security breaches caused by third-party vendors. In November 2014, a data breach exposed the account information of more than two million Turkish customers. In April of 2015, HSBC informed regulators of a data breach exposing the personal information of mortgage holders that may have been ongoing for the better part of a year.
In the current case, HSBC suffered a DDoS attack at January month-end, coinciding with the first pay period for many in the UK, and close to the British deadline for tax filings.
Earlier in January, an IT problem prohibited more than 17 million customers from logging into HSBC online banking services. Noted HSBC CEO for the UK, John Hackett, “There is a complex technical issue with our internet banking systems, and our IT team has been working non-stop since yesterday morning to find a solution. This has involved many tests, diagnostics and trial runs. We are getting closer to solving the problem, but are not there yet. We can, however, confirm this is not a cyber-attack or any other malicious act.”
The latest service disruption in late January was due to a cyber attack. During the outage, HSBC officials tweeted, “HSBC UK internet banking was attacked this morning. We successfully defended our systems.”
DDoS attacks aim to slow or take business offline, sometimes resulting in crippling financial loss. Internet service is interrupted when botnets are remotely instructed to overwhelm a particular website.
In the last two years, DDoS attacks took a darker turn. In addition to disrupting service, launch of a DDoS attack often leads to additional challenges that include the following:
In media reports, one data expert noted, “We’ve seen DDoS attacks against banks used as a smoke screen and cover for other nefarious activities such as cyber-heists … large value money transfers, or the bulk theft and removal of consumer account data.”
For bad actors, DDoS attacks are relatively inexpensive to launch, and easy to maintain. Once a company suffers a DDoS, the odds are good the attack will recur in a period of days or months.
While HSBC noted it had successfully defended its systems during the cyber attack, the institution is working with the government agency, Computer Emergency Response Team (CERT-UK) to pinpoint the criminal elements involved. For a company with a long history of data theft, fraud, and third party vendor data breach, HSBC has significant compliance and consumer service challenges ahead.
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