Rising Cyber Threats in the Financial Sector: Time to Act

Who should read this?

• For organization– Administrators, CISOs, and IT leaders in the financial sector responsible for safeguarding financial data and securing digital platforms.

What happened?

Cyber attacks targeting the financial sector are becoming more frequent and dangerous. In 2024, several major incidents impacted banks and insurance companies, exposing sensitive information and putting both businesses and their customers at risk. Hackers are using various methods like malware and phishing attacks to break into systems, steal credentials, and access sensitive data, putting financial data at serious risk.

For example, recently:

• A new malware campaign was launched, impersonating tax agencies, fooling users into clicking on fake links, and providing sensitive financial details, including login credentials for bank accounts.
• IDFC First Bank suffered a breach that exposed sensitive data from customers, further underlining the growing cyber security risks in the financial sector.
• Indian banks were attacked by a malware known as Finstealer, which targeted mobile banking apps and compromised user data, including login details.
  

Additionally, a deepfake fraud attack on a major Indonesian bank shows how advanced cyber criminals have become. Despite the bank having strong security measures, fraudsters used AI-driven deepfake technology to trick the bank’s facial recognition system. This attack led to over 1,100 fraudulent loan applications, highlighting the risks in digital identity verification systems.

Why does it happen?

1. Valuable data-The financial sector is a treasure trove of valuable information, including bank accounts, credit card numbers, and insurance details. This data can be sold on the dark web or used for a range of fraudulent activities. Criminals are drawn to the sector because of the high monetary value of the data it holds.
2. Weak cyber defenses-Despite growing threats, many financial institutions are still lagging in cyber security. Outdated infrastructure, underfunded IT departments, and the lack of effective threat detection systems make these organizations easy targets for hackers.
   

What’s the risk?

• Personal and financial data theft-Stolen financial information can lead to fraud, identity theft, and other criminal activities. Once data is compromised, it can be sold or used by criminals to make fraudulent transactions or open unauthorized accounts.
• Service disruption-Cyber attacks can lock up critical financial systems, making online services inaccessible, blocking payments, and interrupting transactions. This disrupts not only business operations but also impacts customers who rely on smooth, uninterrupted service.
• Reputational damage-Financial institutions thrive on customer trust, and data breaches can shatter that trust. Customers whose sensitive data is compromised may choose to stop using the institution’s services, causing long-term damage to the organization’s reputation.
  

How can organizations defend against these attacks?

1. Consider creating an incident response plan-Financial institutions should have a plan ready to deal with cyber attacks. This plan should include steps to take right away, ways to protect data, and how to inform customers quickly.
2. Use stronger login security-Make sure all-important systems use Multi-Factor Authentication (MFA). This adds an extra layer of protection, so even if someone gets a password, they can’t easily get in.
3. Update software periodically-Keep software and systems up to date to fix any security gaps. Periodic updates help protect against attacks that try to exploit old weaknesses.
4. Check third-party security-Since financial institutions work with other companies, it’s important to periodically check if these companies follow good security practices and only have access to what they need.
5. Keep a close eye on employee behavior-Sometimes, the biggest threat comes from within. Employees, whether intentionally or unintentionally, can expose sensitive data. Periodically remind your staff about security and encourage a culture where they report any suspicious activity.
6. Limit data access-Not everyone needs access to everything. Restrict access to sensitive data based on roles. If employees can only access the information they need to do their job, it reduces the chances of a mistake or malicious act causing a major issue.
7. Secure all types of communication-It’s not just about email—consider securing your phone lines and messaging systems, too. Hackers could target any way information is passed, so it’s important to ensure everything is protected, even conversations.

References

1. California man steals $50 million using fake investment sites, gets 7 years
2. New Malware Campaign Mimic Tax Agencies Attacking Financial Organizations
3. Hackers Steal Data From Leading Indian Bank
4. FinStealer Malware Attacking Leading Indian Bank’s Mobile Users To Steal Login Credentials
5. Now AI Can Bypass Biometric Banking Security, Experts Warn