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Developing an Effective Financial IT Strategy for Your Organization
The latest reports on cyber crime in the financial services industry are, in a word, grim. According to the latest FinCEN Report from the government, reports of cybercrime in the financial services industry doubled in 2021 over 2020, and it’s not likely to slow down any time soon. If you provide financial services to your customers, and haven’t invested in a Financial IT Strategy that includes robust cybersecurity—now’s the time to fix that.
Consider these sobering numbers from FinCEN, the financial crimes reporting agency from the US Department of Treasury:
- Financial institutions filed 635 cyber crime reports in the first half of 2021—more reports than in all of 2020
- The estimated damaged from the incursions for the first half of 2021 was $590 million, compared to $416 million for the entire year of 2020
- The average amount of reported ransomware transactions in 2021 averaged about $102.3 million.
And that’s just on the traditional financial institutions front. Seventy percent of transactions with BitCoin, for instance, are estimated to be part of ransomware or other criminal activities.
Clearly, the time to upgrade and re-examine your Financial IT Strategy is now. But how do you get started, and what do you look for? Let’s explore some of the first steps you should consider.
The Top Threats Your Financial IT Strategy Must Address
It’s no secret that technology is becoming more sophisticated every day. Unfortunately, cybercrime is constantly evolving, too.
Businesses can be crippled by malware powered by AI botnets on IoT, ransomware, and other aggressive cyberattacks. For your financial IT plan, three concerns must be addressed as part of your comprehensive strategy.
As proven by the 2013-2015 bank attack example, your employees will always be your “weakest link.” To be effective, any financial IT solution must include an emphasis on cybersecurity awareness training for all employees who access your network. New employees should have this training when onboarding, too. Your IT solution should include cybersecurity awareness training and a set of guidelines, policies and procedures regarding online behavior for all employees.
Some disgruntled employees may leave your organization and deliberately sabotage the network through hacking and malware installation. Special attention should be given to ensuring employees who are no longer part of your organization have all permissions revoked immediately.
Cybersecurity awareness training makes your employees knowledgeable gatekeepers of your network security, instead of unwittingly remaining liabilities to it.
IoT and BYOD Threats
The Internet of Things (IoT) offers a juicy target to hackers, because the cybersecurity on these devices is usually lax, and the information stored on them include intimate personal details about your movements, conversations and activities. Employees or customers who use these devices to access financial records are putting themselves at risk. The same thing goes for employees or customers who use their BYOD phones to access financial records, as well.
Your financial IT solution will need to include all personal devices that are routinely used for organizational or personal needs. This can become complex when you consider that every employee in your workforce has tablets, smartphones, and even connected devices like fitness trackers. Each device your employees brings into the workplace is a potential cybersecurity vulnerability.
Every device that relies on IoT is a threat, too. Examples of these devices can include Alexa, smart systems (lighting, thermostats, cameras and security devices, for instance), laptops and more. If it connects to the global internet, it can be considered an IoT device. These may slip through the cracks because they do not use the same software and operating systems that your network does. Forgetting to protect them, according to Forbes, can be a dangerously costly mistake.
Unsecured Third Parties
As a financial organization, you are firmly tied to many third-party vendors. Your financial IT solution needs to include policies and procedures to limit access to data from your vendors, no matter the size of your business.
Cyber criminals are targeting financial instiutions with spear fishing attacks by impersonating security vendors. Using information gathered from the National Credit Union Association, these cyberattacks were directed at credit union Bank Security Act agents who were responsible for monitoring activities that may be associated with money-laundering. These bank officials were emailed money-laundering alert emails which, once opened, spread malware to all contacts on the employee’s lists. This spear-phishing attack failed because educated bank officers noticed the red flags in the emails: grammatical errors and irrelevant email addresses.
Your financial IT strategy should cover your interactions with your vendors to limit your organization’s vulnerability to third-party cyberattacks.
Financial IT Strategy Best Practices
Technology and finance used to be considered separate entities, but today finds integration between the industries with the increase of Fintech applications like Bitcoin, Acorn, PayPal, and Square. Today’s financial industry must be protected from cyber attack across all platforms while still offering services such as mobile or online access to accounts.
In addition to the initial financial loss your business faces after a breach, you may also be facing hefty fines and penalties if you haven’t met certain government regulations regarding your electronic storage and communications.
- Payment Card Industry Data Security Standard: Stipulates requirements for institutions that work with credit and payment cards
- Sarbanes-Oxley Act: Governs requirements relating to the storage and management of electronic financial records.
- Gramm-Leach-Bliley Act: Sets requirements for the safekeeping and collection of financial information
It’s an important part of any successful financial IT solution to make sure all your internal and cloud-based networks are protected to stay compliant with industry standards and regulations.
The following four IT security best practices are important keys to implementing a successful cybersecurity strategy for your financial organization.
End to End Encryption
The National Conference of State Legislatures outlines almost 300 state laws relating to cybersecurity . Some of these were directly related to financial institutions and industries, just like yours.
Your best defense is using military-grade end-to-end encryption on all your data. This is a security step that can prevent cybercrime and reduce the amount of damages caused by a breach by limiting how much data is exposed to hackers.
Routine Monitoring as Part of Your Overall Financial IT Strategy
Your successful financial IT solution will involve continuous monitoring of your network. This is a proactive step that can identify cyber threats as they happen, rather than waiting until a breach occurs and trying to mitigate the damage. This monitoring will occur on top of your security features, such as your antivirus, antimalware suite, and firewall.
Organizational Cybersecurity Framework
As time consuming as it seems, your IT solution must cover all devices within the company. This includes devices issued by your organization as well as any BYOD equipment your employees use. Every device, every employee, and every access point must be accounted for in your cybersecurity framework. In other words, all resources (digital, physical and human) need to be noted in this framework.
You can use this framework to build an IT infrastructure that is scalable and secure. Make sure to update this regularly, accounting for upgrades, new hires, and discontinued equipment.
The Future of Financial IT Strategy
The 2020s are shaping up to be a decade full of amazing technical advances in devices and services. Some of the most exciting changes are taking place in the way financial institutions digitize the supply chain and customer access to services. All of this equates to new ways to generate revenue for any financial organization willing to make a solid IT investment.
The flip side of this, however, is that cybercriminals have continued to evolve their attacks to meet each new technology. Today’s cyber crime is targeting financial institutions, with hackers bringing financial industry education into their game. Compliance officers, the stock market, financial regulators, and SWIFT communications can all fall prey to a dedicated cyber criminal with time, resources, and know-how on his side.
Iconic IT can bring you a comprehensive financial IT strategy that will align with state and federal regulations, protect you from lawsuits, keep your money where it belongs, and bring you peace of mind. Contact Iconic IT for a free, no-obligation consultation and let us show you how you can improve your current IT strategy today.