Biggest Threat To Financial Institutions Is Cybersecurity – SEC

Hackers pose most significant threat to global financial systems

Adverse online activities by hackers pose the greatest risk to the global financial system, said the chair of the U.S. Securities and Exchange Commission (SEC) during the Reuters Financial Regulation Summit in Washington, Tuesday.

The recent $81 million cyber theft from the Bangladesh central bank that was funneled through SWIFT, a member-owned industry cooperative that handles the bulk of cross-border payment instructions between banks, has sent shock waves through banks around the world.

SWIFT is a high target for malicious actors and digital adversaries, mainly because it’s reportedly an easy target. An incident investigator said that the bank has no firewall, and used second-hand switches to connect computer systems to SWIFT.

The SEC, which regulates securities markets, has found some major exchanges, dark pools and clearing houses did not have cyber policies in place that matched the sort of risks they faced, SEC Chair Mary Jo White said at the summit.

“What we found, as a general matter so far, is a lot of preparedness, a lot of awareness but also their policies and procedures are not tailored to their particular risks,” she said.