Last updated September 27, 2022
- 35% of all data breaches target financial institutions. These hacks can do more than steal money—they can also access huge amounts of customer data, including SINs and credit card information.
- The biggest cyber threats facing organizations in the financial sector include state sponsored attacks, employee errors (often via phishing or other social engineering scams), and supply chain attacks via third-party vendors.
- Financial organizations should work with an MSSP (managed security services provider) to review their cybersecurity posture, identify gaps, and create protocols that address them.
Having a strong cybersecurity posture is incredibly important for any industry, but the financial services sector needs to be particularly vigilant.
While many of us likely remember the CapitalOne hack of 2019, most cyberattacks in the financial sector aren’t covered by the media to the same extent. This means that many financial organizations still feel that they are unlikely to be targeted, even though, according to Forbes, 35% of all data breaches target financial institutions, making it the single most targeted industry.
Why Is Cybersecurity Important in the Financial Industry?
Cybercriminals target the financial industry because that is (quite literally) where the money is. Not only are financial institutions responsible for safeguarding their client’s money, but they also hold large quantities of customer personal data, including SINs, credit card numbers, and other highly sensitive information.
When a financial institution experiences a data breach or falls victim to a ransomware attack, they risk more than losing access to critical files or even experiencing financial loss, either by being robbed or by having to pay a ransom to unencrypt their files. Consumers trust their banks and other financial institutions to safeguard their money and their personal information, and when that trust is broken, it can be difficult to earn back.
Biggest Threats That The Financial Industry Face
Though the financial services industry faces many cybersecurity threats, the biggest threats most financial institutions face are:
State Sponsored Attacks
When most of us think of cybercriminals, we think of a lone wolf out to line their own pockets with other people’s money. While that is often the form cybercrime takes, state-sponsored attacks are also a serious threat. Some governments target not just foreign governments, but also foreign stock exchanges, foreign banks, and other economic pillars in an effort to destabilize the target country.
To acknowledge the devastating effect cyberattacks can have on countries, NATO declared cyberspace as the fifth domain of warfare in 2016. This recognized the critical role that IT plays in a country’s existence.
Though cybercriminals often employ sophisticated techniques to gain unauthorized access to organizations’ computer systems and data, too many attacks are ultimately caused by human error. Phishing and other social engineering attacks continue to trick employees into revealing sensitive information, essentially handing the keys to the digital vault over to criminals.
There are 3 main reasons employee errors occur:
- Employees haven’t been trained to effectively recognize and avoid cybersecurity attacks.
- Employees aren’t following cybersecurity protocols correctly.
- Employee devices aren’t configured correctly. This problem is more common in BYOD environments.
In rare cases, employees act maliciously and steal sensitive information themselves.
Third Party Vendors
Even if your organization has a robust cybersecurity posture, are all of your third party vendors as stringent as you are? Organizations that use third-party vendors are exposed to more vulnerabilities, increasing their chances of experiencing a breach. In 2014, retail giant Target had to pay an $18.5 million settlement after cybercriminals gained access to their network using valid credentials stolen from one of their third-party vendors.
Not only do third-party vendors increase the number of entry points into your network, but they have their own IT and cybersecurity platforms and configurations that are outside of your control, making it more difficult for you to secure your network.
What Can I Do to Improve My Organization’s Cybersecurity Posture?
There are quite a few things your organization can do to improve your cybersecurity posture. To begin with, you should work with your Managed Security Services Provider (MSSP) to take stock of your current protocols and identify gaps. Then, you should work with your MSSP to create tailored cybersecurity protocols to address your needs and safeguard your network.
For more information about basic steps your organization should be taking, please read our blog post Cyber Hygiene 101: Basic Steps to Keep Your Company Secure.