Cybersecurity in the financial industry

By FintechNews Staff

-Second only to healthcare in the hierarchy of most cybersecurity attacks, the financial industry is harangued on all sides by cybercriminals.

–Hacking and malware are the leading causes of data breaches in financial services. However, insider threats and accidental disclosures are both growing. Rising cloud adoption is expected to increase these threats over the next several years.

– In 2019, Jamie Dimon, CEO of J.P. Morgan Chase & Co stated that, “Cyberattacks may very well be the biggest threat to the U.S. financial system.” This is why J.P. Morgan Chase spends nearly $600 million each year to strengthen its cyber defenses.

-Cybersecurity topped the list of expected budget increases in a survey of technology spending conducted by Deloitte & Touche LLP, with 64% of executives at financial firms around the globe forecasting a rise.

-Most large banks have the resources to cover all their needs, yet sadly not all small firms have this capital available. Smaller banks typically spend less on cybersecurity and therefore could become more susceptible to being exploited as a backdoor entry point into the Federal Reserve’s systems.

-To avoid this scenario, the federal government is putting new regulations in place, with the input of bank leadership, to create a collaborative defense, recovery, and reporting system.

–Consumers have little direct risk from cyberattacks on financial institutions. As long as they use reasonable safeguards to protect their information, consumers are protected by US federal law that requires banks to refund customers if they notify the bank within 60 days of an errant transaction appearing on their statement.

To go deeper on these subjects: 

-Open finance: the next level for data sharing

–Could open banking pose new security threats to your financial data?