Cyber Attack and critical infrastructure

Despite the many threats it faces, the banking industry has long instilled outstanding confidence in its clients and investors.

However, in recent years, the industry has seen an increase in the number of cyber-attacks recorded around the world. Because of the industry’s growing competition, most financial firms have been developing innovative strategies, goods, and facilities in order to improve their clients’ utility and maintain their loyalty (Cuomo, 2014). As much as the latest policies have fueled business expansion, they have also paved the way for a slew of new threats, including cyber terrorism. This paper delves into some of the effects that cyber-crime has on the financial sector. It also looks at some of the measures that the Department of Homeland Security (DHS) is taking to curb this vice.

Cybercriminals and Their Strategies

Cybercriminals have been using emerging technology to frustrate the efforts of the financial institutions. For instance, the use of mobile and cloud has enabled the hackers to lop into the multifaceted authentication technologies, allowing them to access critical information pertaining to the banks’ clients (Symantec White Paper, 2016). This has not only disrupted the normal activities of the institutions but also induced fear among the clients. Some of the customers have resorted to other ways of saving, thereby reducing the amount of cash received by financial institutions.

Rising Financial Frauds

Since the launching of cybercrimes against the banking sector, the number of financial frauds has been skyrocketing. Cybercriminals normally use Trojans to execute frauds. Indeed, this vice constitutes one of the major threats on the internet. According to a report released by PwC in 2014, more than 90% of the institutions targeted come from the banking sector. The Trojans mainly capitalize on intercepting messages and spreading scams. For instance, victims of scams find themselves clicking on malicious messages meant to dupe them into providing useful personal information (PwC, 2014). The results are very devastating. They end up losing all their savings through account takeovers and ATM heists. Such frauds have seen clients lose their money helplessly. Unfortunately, banks take about ten days to recoup money lost through cyber acts on average. Additionally, they have to inform other global watchdogs and authorities if such money is to be recovered. This reality has hurt their operational costs.

Actions Taken by the Department of Homeland Security

The Department of Homeland Security (DHS) has been taking some measures to mitigate the wanton effects of cyber terrorism, particularly on the banking institutions. To enhance its efficiency, the department has been conducting surveys in the various banking institutions across the US and beyond (Rege, 2016). The questions mainly address issues pertaining corporate governance about cybersecurity, cost implications of the vice, occurrence of the acts, and responses therein.

Training and Preparedness

DHS organizes training for the banking institutions in a bid to mitigate cybercrimes. The officials handling finances are sensitized on some of the strategies and or technologies employed by the cybercriminals to defraud banks. They are also made aware of some of the emerging and confiscated technologies that could help them ameliorate the situation (Cuomo, 2014). The training is tailored to suit the needs of the various institutions. The action is in full cognizance of the fact that large, medium, and small banking institutions have different needs. Some of the tools the institutions are expected to use are spyware and malware detective devices, antivirus software, and server access control tools. The department has also committed itself to collecting information related to the vices. It also shares the same with the stakeholders, besides taking any action within their mandate.

A Collaborative Approach

A more collaborative approach to dealing with cybercrimes ought to be adopted, going into the future. The financial industry, the DHS, other security agencies, and global financial watchdogs ought to come together and devise methods of dealing with this vice. Their strategies should be proactive, geared towards inhibiting the acts as opposed to taking actions long after the atrocities have been executed. In this way, the costs of operations will have been minimized. Also, the financial institutions will have reinstated the confidence of their clients and therefore incentivized them to save more (Rege, 2016). Moreover, it is important for the institutions to document security strategies that they intend to employ, going forward. Small and medium enterprises have lagged behind in this area. It is worth noting that no organization can implement that which they do not have.

Conclusion

In conclusion, the effects of cyber terrorism on the banking institutions have been on the rise. Nevertheless, various stakeholders have come together to eliminate it. The commitment of the DHS in ensuring zero tolerance to cybercrimes targeting financial institutions cannot be overemphasized. The department’s plans to enhance the IT policies have been hailed the world over. There are high indications that the future is bright.

References

Cuomo, A.M. (2014). Report on Cyber Security in the Banking Sector. New York: State Department of Financial Services. Retrieved September 16, 2017 from: http://www.dfs.ny.gov/reportpub/dfs_cyber_banking_report_052014.pdf

PwC. (2014). Threats to the Financial Services sector. Retrieved September 16, 2017 from: https://www.pwc.com/gx/en/financial-services/publications/assets/pwc-gecs-2014-threats-to-the-financial-services-sector.pdf

Rege, A. (2016, June). Incorporating the human element in anticipatory and dynamic cyber defense. In Cybercrime and Computer Forensic (ICCCF), IEEE International Conference on (pp. 1-7). IEEE.

Symantec White Paper. (2016). Cyber Security for Financial Services: Strategies that Empower your Business, Drive Innovation and Build Customer Trust. Retrieved September 16, 2017, from https://www.symantec.com/content/en/us/enterprise/white_papers/cybersecurity-whitepaper-financial-wp-21352892.pdf