How financial institutions fight hackers
Last year, a group of hackers claimed to have stolen 100TB of data from Sony Pictures Entertainment. It was by no means the first, but arguably the most high-profile breach of its kind, highlighting that corporations need to up their defences against cyber criminals. In the US, regulators are now cautioning that financial institutions need to learn the lessons from Sony's attack and get ahead of any potential hacks – but what does this mean for your financial security?
Reassuringly, new tactics are constantly being developed at government, corporate and customer levels to protect your money and data. Today, we're going to explore how these work.
Government policy
The majority of countries have organisations designed to keep the financial environment safe, like the US' FSOC or the FCA in the UK. As part of this, they'll often support financial firms in monitoring and countering cyber attacks. They, and their governments, do this by:
- introducing regulations, like the European Central Bank’s Payment Services Directive 2, that require finance companies to meet a set security standard
- organising cyber ‘war games’ that test financial institutions with simulated hacks
- hiring ‘ethical hackers’ to expose financial institutions' weaknesses and help improve them.
Corporate strategy
In most cases, banks aren't taking the threat lightly either. According to the British Banking Association, those in the UK spend £700m on cyber security each year. That investment goes on:
- account monitoring – any reputable institution will have an anti-fraud team and specialised software to identify unusual activity
- employing geopolitical analysts to track global threats
- sharing information on potential threats with other banks and IT experts.
Customer security
Whether you’re using financial services for personal banking or international money transfer, you’ll find several measures in place to protect your funds. These might include:
- digital tokens that convert data into a code during a transfer, so no personal information is revealed
- ‘two-factor authentication’, which is a second layer of protection, like a chip-and-pin reader for online banking or single-use verification codes
- account alerts to tell you when money's moved
- biometrics – while this is still in its infancy, you could soon be scanning your fingerprint or using facial recognition tech to transfer money online.
We've put together a five-step guide to making sure your payment info's secure online, so take a look if you'd like to find out more. You can also read about how your money's safeguarded when sending money overseas in our 101 guide.
