Financial researchers at Carnegie urge immediate efforts to counteract cyber threats in the financial sector
The COVID-19 pandemic has accelerated the shift towards home-based computer systems, making them vulnerable to cyberattacks. In response, over 200 international stakeholders have come together to secure these systems. This group, known as the Euro Cyber Resilience Board for pan-European Financial Infrastructures, includes central banks, market participants, Europol, the European Union Agency for Cybersecurity, and key officials from the U.K., U.S., and other nations.
The Carnegie Endowment for International Peace, in collaboration with the World Economic Forum, has released a report highlighting the urgent need for government organizations and financial institutions to combat rising malicious cyber activity. The report identifies fintech business development and the digital transformation of the banking industry as opportunities for criminal hackers and rogue states to attack vulnerable systems.
The report urges G7 and G20 governments to develop tighter controls to protect the financial sector from emerging cyber threats. It suggests joint exercises between governments, financial institutions, and cloud-based service providers to test the resilience of the system against potential global cyber disruptions.
Criminal gangs have developed more sophisticated versions of ransomware and other hacking tools, including penetration tools like Cobalt Strike and PowerShell Empire. North Korea is reported to have stolen over $2 billion from 38 countries in the past five years. However, the report does not mention any specific countries or organizations that have been targeted or involved in these cyber activities.
Bank of England Gov. Andrew Bailey has stated that until this year, he was more concerned about operational risks, seeing cyberthreats as a risk underlying that. He described cyberthreats as "the quintessential risk that doesn't know borders." The advent of sophisticated cyberthreats requires a new way of thinking, according to Bailey.
Tim Maurer, senior fellow and director of the Cyber Policy Initiative at the Carnegie Endowment, emphasizes the need for governments and industries to break down silos and work together to combat cyber threats. Several officials spoke out on the threat during a virtual presentation.
Notably, London-based Travelex, the global currency exchange, was hit by a ransomware attack on New Year's Eve 2019, which cost the firm up to $30 million and eventually contributed to a bankruptcy filing. The report does not provide a timeline for when these suggested actions should be implemented or specific details about the nature of these cyber threats or the measures suggested to secure home-based computer systems.
Following 9/11, the concern was more about maintaining physical distance, while being able to closely tie operating environments together to allow for seamlessly switching after an attack. Today, the focus has shifted to securing these digital environments to prevent such attacks from happening in the first place. The international community's response to the rising cyber threats underscores the importance of collaboration and vigilance in the face of these evolving risks.
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