The World is at War (Online)
A few weeks ago, I wrote about the increasing information security threats that are faced by financial institutions, using the acronym CHEW to explain the main antagonists in the cyber arena. Broadly, this refers to Criminals, Hackers, Espionage and War, and although retail banks are rightly concerned with the first letter, capital markets institutions tend to focus on the last three.
Given the complexity of modern markets, it's something of a wonder that anybody outside of advanced operators would be able to do anything of substantial severity to something like, say, a clearing house. But stock exchanges are reporting an increasing number of attacks on their infrastructures, according to the International Organization of Securities Commissions (Iosco), in a report released last week. More than half, in fact, have suffered attacks over the past year.
Nasdaq, of course, has been publicly targeted, most recently with its bulletin board system being compromised. Websites are frequently the subject of distributed denial of service (DDoS) strikes, a favored method of assault from so-called ‘Hacktivist' groups or movements, like Anonymous, where botnets and zombie computers are slaved to launch access overload strategies, crashing servers in the process.
Impending Troubles
There's a growing acceptance of cybersecurity concerns in the industry. But the perpetrators are becoming more advanced, not only in terms of their attacks, but also in their knowledge of targets. Traditionally, the public has been keen to criticize the investment banking industry without necessarily understanding its ins and outs, but with the financial crisis that is starting to change. The Occupy movement, for instance, produced several documents of technical note, particularly through its American arm, and it's not a huge stretch to imagine that other activists (not necessarily related to Occupy) with a bone to pick, technology nous and the time to study market structure, could inflict damage.
This is the real danger, when intrusion and disruption are not necessarily motivated by financial concerns. After all, skimming a retail operation could yield cash, but crashing a depository (and, I've been told, first hand, they frequently get attacks or intrusion attempts that are very deliberate) won't buffer the bank balance. That's where the other letters come in ─ from political activists, or state actors looking to destabilize national infrastructures.
There's a growing acceptance of cybersecurity concerns in the industry. But the perpetrators are becoming more advanced, not only in terms of their attacks, but also in their knowledge of targets.
Prevention
All of this, reinforced by the latest Iosco report, means that new risks are constantly being presented in an organic environment such as modern techno-culture, and must be dealt with. The internet is often labeled as humanity's greatest achievement, the great democratizer and enabler of society, but it also carries its own dangers with it, which are ignored at the peril of those who choose to do so.
Only users who have a paid subscription or are part of a corporate subscription are able to print or copy content.
To access these options, along with all other subscription benefits, please contact info@waterstechnology.com or view our subscription options here: http://subscriptions.waterstechnology.com/subscribe
You are currently unable to print this content. Please contact info@waterstechnology.com to find out more.
You are currently unable to copy this content. Please contact info@waterstechnology.com to find out more.
Copyright Infopro Digital Limited. All rights reserved.
You may share this content using our article tools. Printing this content is for the sole use of the Authorised User (named subscriber), as outlined in our terms and conditions - https://www.infopro-insight.com/terms-conditions/insight-subscriptions/
If you would like to purchase additional rights please email info@waterstechnology.com
Copyright Infopro Digital Limited. All rights reserved.
You may share this content using our article tools. Copying this content is for the sole use of the Authorised User (named subscriber), as outlined in our terms and conditions - https://www.infopro-insight.com/terms-conditions/insight-subscriptions/
If you would like to purchase additional rights please email info@waterstechnology.com
More on Trading Tech
Canada’s triparty repo launch aims to fill C$60bn void
Test trades on TMX/Clearstream platform represent “quantum leap” for creaking funding markets
People Moves: NorQuant, Tradition, Duco, HKEx, SimCorp, Hazeltree, Xceptor, Broadridge, and more
A look at the past month’s people moves in the capital markets technology and data space.
Bank-led consortium takes aim at position reporting
Five banks, including Barclays, BNP Paribas, Goldman Sachs and HSBC, have joined forces to mitigate interpretation and implementation errors in position reporting disclosures.
This Week: BBH, AllianceBernstein add data solutions, Deutsche Börse-Nodal Exchange, and more
A summary of some of the latest financial technology news.
Consortium backs BGC’s effort to challenge CME
Banks and market makers—including BofA, Citi, Goldman, Jump and Tower—will have a 26% stake in FMX.
Symphony boosts Cloud9 voice offerings with AI
The messaging and collaboration platform builds on Cloud9’s capabilities as it embraces the AI wave in what CEO Brad Levy calls “incremental” steps.
Can exchanges leverage new tech to claw back ETF share from RFQ platforms?
Systematic trading strategies and proliferating data are bringing efficiency to an otherwise-fragmented European ETF market.
Nasdaq reshuffles tech divisions post-Adenza
Adenza is now fully integrated into the exchange operator’s ecosystem, bringing opportunities for new business and a fresh perspective on how fintech fits into its strategy.
Most read
- Chris Edmonds takes the reins at ICE Fixed Income and Data Services
- FactSet looks to build on portfolio commentary with AI
- Women in Technology & Data Awards 2024: All the winners and why they won