This week, Emma Dunkley of the Financial Times published an amusingly titled yet insightful piece on the recent cyberattacks levelled at two major high street banks. Not to be misled by the lighthearted headline of the article, her account provided another chilling glimpse into the reality of what major banks and consumer organisations now face on almost a daily basis when it comes to protecting their data.
“The recent attacks on Lloyd’s Banking Group and Tesco Bank revealed the evolving techniques used by cybercriminals to expose financial institutions’ vulnerabilities”, she wrote, as she sought to explain the wider implications of what had happened. “The threat of cyber assaults is increasing. As banks roll out more digital services, and as more customers use technology to handle their money, cyber criminals have a greater number of entry points through which to access systems and customer data.”
On January 11th, Lloyds was hit by what is commonly known as a ‘denial of service’ attack, where hackers hijacked several of the bank’s servers and flooded their website with large amounts of traffic designed to cripple online services. Upon discovering that they could not gain access to online banking, many customers took to social media to vent their frustration, as Lloyds deployed a series of counter-measures designed to isolate the attacks and limit the damage caused.
Although large banks are typically targeted by denial of service attacks around once a month, the Lloyds incident was particularly severe – with this attack lasting far longer than the usual few hours.
“Denial of service attacks are happening 24/7 globally,” says Philip Halford, a senior adviser at financial services consultancy Bovill. “There are multiple perpetrators, often targeting the same trophy targets. They share the common objective to breach a control system sufficiently to allow or deny legitimate users access to it. The motivation can vary from criminal intent to mere bragging rights. The effect, however, can be crippling for organisations.”
Compared to the Tesco Bank fraud that took place in November last year, the Lloyds attack was relatively mild, with no customer data or money having been stolen. It is reported that the hackers behind the attack demanded a £75,000 bitcoin ransom, although it is unclear whether Lloyds bowed to this request.
Tesco Bank was not so lucky. Last year’s assault led to nearly £2.5m worth of payouts to 9000 customers who had money stolen by cyber criminals. This time, the data breach was facilitated by a weakness in one of Tesco’s mobile banking apps, which was exploited to access personal information connected to thousands of current and savings accounts. Thankfully Tesco Bank acted quickly to reimburse customers, but the incident still represents a significant and worrying reality of the risks posed by hackers.
What the attacks on Lloyds & Tesco Bank tell us about how online crime is evolving
Over the past twelve months, news of major cyberattacks has become increasingly commonplace – with 2016 seeing more sophisticated assaults than ever before.
Cyber crime is on the rise, with attackers developing increasingly sophisticated hacking techniques to break through organisations’ defences. It is one of the biggest risks to global banking, threatening to cripple lenders and defraud customers.
As the Financial Times rightfully put it, “the stakes are high”. When we consider the reputation of the UK banking sector amongst its customers, trust is a critical factor, and information security plays a huge role in this. Not only must banks consider their reputation in this matter, but also the potentially significant fines and sanctions imposed by financial regulators where institutions are seen to have failed in their obligation to protect customer information and assets.
Under the UK Data Protection Act, banks can currently be hit with a penalty of up to £500,000, but an EU directive that comes into force in May 2018 will mean companies can be fined up to 4 per cent of their global revenues for serious data breaches.
As we move into an increasingly tech-dependent world, banks and other organisations alike have an ongoing responsibility to stay ahead of the threats posed by cybercriminals – and as we so often hear, this isn’t just down to software.
Education also plays a huge part in cyber resilience, and equipping staff with the right knowledge can mitigate risk on a truly massive scale. We know that as much as 90% of all cyberattacks are mounted as a direct result of the unwitting action of a member of staff – whether that’s clicking on a phishing email, or falling foul of social engineering. Never before has it been so important to place cyber resilience at the top of your business agenda.
Interested in better understanding the implications of increased cybercrime for your business? Join our free webinar in partnership with AXELOS GBP and featuring Vicki Gavin of the Economist Group, as we explore the most effective ways to safeguard against cyberattacks. Join the webinar and explore more here.
For the full original FT article, click here.