Preparing financial institutions for the next generation of cyber threats
In this Help Net Security interview, James Mirfin, SVP and Head of Risk and Identity Solutions at Visa, discusses key priorities for leaders combating fraud, the next-generation threats institutions must prepare for, and the role of collaboration between financial sectors and government agencies in countering cybercrime.
If you were to advise a newly appointed leader against fraud in a financial institution, what three priorities would you recommend they focus on immediately?
As a newly appointed leader against fraud in a financial institution, it’s important to establish a strong foundation against fraud and cybercrime quickly. To begin, the leader against fraud must conduct a comprehensive risk assessment to identify, evaluate and pressure test the organization’s current security systems. This involves understanding the critical assets, potential threats, vulnerabilities, and the impact of potential breaches.
After that, they must ensure their company is compliant with regulatory frameworks. Financial institutions are heavily regulated, and non-compliance can result in significant fines and damage. Establishing a governance framework that includes policies, procedures, and controls to ensure ongoing compliance is vital.
Lastly, implementing a robust security awareness and training program for all employees is critical. Human error is often a significant factor in security incidents, so educating staff on recognizing and responding to security threats is crucial. Conducting regular training sessions, phishing simulations, and awareness campaigns to keep security top of mind for all employees is essential. This training should include recognizing social engineering attacks, secure handling of sensitive information, and incident reporting procedures.
What are the most pressing next-generation threats that financial institutions must prepare for in the next 3–5 years?
In the next 3-5 years, financial institutions must prioritize their defenses against the top three next-generation threats: advanced fraud attacks, ransomware evolution, and customer and employee exploits.
Sophisticated fraud attacks pose risks as they can infiltrate networks undetected and share sensitive data over extended periods. To combat these threats, institutions must enhance their cybersecurity frameworks with advanced threat detection and response systems.
Ransomware attacks are becoming more targeted and sophisticated, often demanding hefty ransoms. Robust regular risk and security trainings for employees are essential to mitigate these risks.
Lastly, cybercriminals are increasingly seeing the employee or customer as the weakest link, using generative AI, and sophisticated techniques to dupe unaware employees or customers to take an action or make a payment, believing they are doing something legitimate. Driving high levels of awareness of the various techniques, and deploying multi-layered defences to detect and block these threats is critical.
How important is collaboration between financial institutions, government agencies, and other sectors in combating next-generation threats? Are there successful models or case studies you can share?
Collaboration between financial institutions, government agencies, and other sectors is crucial in combating next-generation threats. This cooperative approach enhances the ability to detect, respond to, and mitigate sophisticated threats more effectively.
Visa regularly works with international agencies of all sizes to bring cybercriminals to justice. In fact, Visa regularly works alongside law enforcement, including the US Department of Justice, FBI, Secret Service and Europol, to help identify and apprehend fraudsters and other criminals. Visa uses its AI and ML capabilities to identify patterns of fraud and cybercrime and works with law enforcement to find these bad actors and bring them to justice.
Recently, Visa partnered with these agencies to bring down the storied FIN7 cybercrime gang, perpetrators of an international ATM cash out enterprise, and recovered millions of dollars laundered by an organized crime ring. This success would not be possible without cooperation.
What unique vulnerabilities do financial institutions face compared to other industries, particularly in critical infrastructure and financial ecosystems?
Financial institutions face distinct vulnerabilities compared to other industries, particularly due to their role in critical infrastructure and financial ecosystems. As high-value targets, they manage large sums of money and sensitive information, making them prime targets for cybercriminals. Their operations involve complex and interconnected systems, often including legacy technologies and numerous third-party vendors, which can create security gaps.
Regulatory and compliance challenges add another layer of complexity, requiring stringent data protection measures to avoid hefty fines and maintain customer trust. The need for real-time transaction processing leaves little room for error, while advanced threats from nation-state actors and sophisticated attackers pose significant risks.