As cyber criminals exploit the increased attack surface, banks must keep up with technology to ward them off or face severe consequences
Cybercrime on the global banking and financial services industry has recorded a tectonic increase over the last five years. Hackers are deploying sophisticated technology to get illegal financial gains.
Ernst & Young states that earlier, the attacks stole information, but of late, attacks have become more sophisticated, involving ransomware, and worms.
Cryptolocker demanded a ransom in Bitcoins in exchange for the decryption key, whereas
Mamba has caused panic by encrypting the entire hard disk drive, including the bootloader. Another ransomware that shook the world is
Banks and financial institutions are working towards building both internal and external user awareness to ward off malicious digital attacks. However, Accenture states that of all the phishing, malware, and penetration attacks that banks receive, 36% are successful each year on an average. Accenture also states that senior bank executives are confident about their cyber security strategy, but a lack of comprehensive, practical testing leaves a gap in their defense allowing hackers to break the security shield and conduct cyber-crime. Banking security professionals therefore must continuously keep track of the new age exploits being used by cyber criminals to implement an effective security strategy.
Rising Digital Payments a Security Risk for BFSI Segment
Today, cash and credit cards are giving way to digital alternatives. Deloitte reports that the continued adoption of alternate channels such as ATMs, kiosks, internet, mobile, cloud, and social media technologies have increased opportunities for attackers. If cyber-criminals create a worm like the
Greendispenser which attacked ATMs in Odisha, coupled with a ransomware, it would be disastrous for banks across the world since it would encrypt the ATM, demand money and take away cash too.
RBI’s report on Cyber Threats and Security states that cyber criminals have exploited online financial and market systems that interface with Internet, such as the Automated Clearing House (ACH) systems, card payments, and market trades as in the case of Union Bank in 2015. RBI also revealed that there was a sharp decline of more than 40 percent in the total value of card transactions from October to December 2016 in India (falling from Rs 306,965 crore in October, to Rs 180,219 crore in December) due to change in Indian mentality towards seeking more secure methods of digital payments like m-wallets, m-banking (SMS, USSD, Mobile Apps) in the wake of demonetization and the emergence of new types of cyber-crime.
While digital payment mechanisms benefit the economy by bringing greater transparency in transactions and reducing corruption, they also come with their share of security woes. A Deloitte report states that fraudulent monetary transfers and counterfeiting of stored value cards are a common result of exploits against financial institutions, payment processors, and merchants. Recently, a cybercrime cell at Pune recorded a case of fraudulent online transactions where the victim’s account was compromised with money transferred directly to nine different digital wallets such as Paytm, Ola Money, etc. Victims did not receive the one-time passwords (OTP) before receiving the message that the money had been deducted.
ATM skimming is another common security threat for which RBI has directed banks and white-label ATM operators to move to chip- and PIN-based card infrastructure by September 30, 2017.
These attacks will get worse. A report by Omidyar Network suggests that as more internet connected devices enter personal, business and government networks, the number of targeted attacks to steal personal information will rise exponentially.
Combating Cyber-crimes and Protecting Data
In order to combat the growing number of security threats, PWC recommends in its report that the BFSI security market can be segmented based on systems and components of video surveillance, access control, intrusion & fire detection, and physical security information management. Threat management necessitates possession of strategic skills and analytical thinking to fight cyber-attacks and protect the data.
Experts suggest employing honeypots which are mainly decoy computer systems to detect cyber attackers and study how they attack the server, and then putting proper checks in actual systems against similar attacks.
Third-party service providers should be regulated and checked periodically and one must ensure that the proper testing and certification is conducted for the apps as well.
Sharing information about cyber-attacks with cyber cells and bodies like the RBI can avert further damages and alert the BFSI sector, gain actionable visibility into their most relevant risks, understand the motives and tactics of adversaries and shed light on effective response methods.
Today, cyber experts are advancing their security information and event management by integrating key threat management tools into the cloud. Conducting penetration tests and updating security wherever essential also keeps cyber attackers at bay.
Attackers also compromise the bank’s environment using various techniques like exploiting vulnerabilities of internet facing servers or systems or harvesting employee credentials by sending spear-phishing emails. Educating employees about cyber threats is as important as installing anti-virus and updating systems regularly to thwart hackers from entering the banks data.
CXOs must keep in mind that data safety should be the key concern of organizations as any leak of data will cost them millions if not more. With technical advancements and cyber-attacks becoming more sophisticated, it is vital for the BFSI industry to constantly monitor and up their innovative technological methods to combat cybercrimes coming their way.