July 20, 2018//Ellen NeveuxLast Updated: November 18, 2020
Though the days of robbing banks aren’t over, the attacks on the financial sector have definitely evolved. Instead of coming up with an elaborate plan that includes avoiding the inevitable security cameras outside a bank, people with malicious intent are choosing a route that gives them access to a wealth of information from to comfort of their home, a cyberattack. All a hacker, or a group of hackers, need is the right hacking kit and an access point onto a network.
The year 2017 was a big year for cyberattacks on financial organizations and the first half of 2018 has continued this trend. The switch over to the cyberattack instead of the typical bank robbing movie scene stems from the fact that bad actors can get into these networks and are able to perform reconnaissance on their targets. In other words, they get more bang for their buck when compared to simply robbing a bank. To put this into idea into numbers, World Economic Forum reported that from the start of 2017 to halfway through 2018, cybercrime groups have caused gross losses of more than $1 trillion to the financial industry.
Cyberattacks in the financial industry
World Economic Forum also reported that cyberattacks are globally perceived as the top risk for business leaders, and the number of attacks are only expected to increase and intensify. Since enterprise organizations rely heavily on external technology to fill their business-critical needs, the exposure to risks is immense. This dependency on outside technology is a door that is left open by many and it can easily be taken advantage of by hackers. In fact, according to Experian, there has been a 44% increase in the number of breaches and a 389% increase in records exposed from 2016 to 2017 and financial services firms are targeted more than any other sector, with breaches tripling over the past five years. To condense this, the number of cyberattacks continue to climb and the financial industry is a top target for cybercriminals.
So why is the financial industry continuously targeted? Since many of these organizations use the same architecture to protect their network, an attacker can understand what they are up against in terms of technologies, defense systems, and business processes and can plan their attack accordingly. Along the same lines, hackers need to be successful only once to really hit a jackpot; a financial institution needs to defend their network from all angles and at all hours of the day. Enterprises need to keep this in mind since the average cost of a cyberattack has increased by over 40% over the past three years, which brings it up to $18 million in 2017. Not only does a cyberattack cost a lot of money in terms of recovery, but post-cyberattack for enterprise organizations also brings the inevitable compliance and reputation headache.
To be blunt, cyberattacks aren’t going away anytime soon; rather, the routes bad actors take will continue to change to reflect on what’s easiest. Some predictions about the forms of cyberattacks in the future include:
What can financial institutions do?
According to a well-known finance and risk blog, they point out that those in the financial industry cannot just hire their way out of this battle against cybercriminals simply because there aren’t enough talented cyberprofessionals out there. Instead, they recommend that enterprise organizations in the finance sector rely on managed security services in the form of software. Since it is predicted that supply chain and third-party attacks are going to continue to be a big threat for the financial sector, secure remote access is a necessity for enterprise organizations. This software is essential because it keeps applications running while protecting critical financial data while always adhering to the necessary compliance standards.
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