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Data Security Facts Financial Services Executives Must Know

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Financial data has been among the most commonly exposed and stolen forms of data. Credit card issuers, banks, retailers and payment processors have been experiencing increased frequencies of breaches. A data breach or data leak can be either intentional (e.g., data theft by intruders or sabotage by insider attackers) or accidental (e.g., accidental disclosure of sensitive information by employees and partners). Data leakage can also occur during data entry tasks. If the financial data entry task is performed by an unreliable or untrustworthy employee, there is a possibility that he/she may disclose confidential information to a third party. Outsourcing data entry tasks to a reliable data entry company is one way to ensure confidentiality of data and minimize cyber security risks. This is because professional data entry providers will have advanced security measures to safeguard the information they handle.

Data Security

According to the 2016 Data Breach Investigations Report, the financial services industry experiences 35% of all data breaches. It is because the industry is known for its wide array of interconnected systems and the processing of millions of transaction factors that make it more vulnerable to attacks. Nowadays, financial institutions are adopting various measures to increase data security. For instance, of the 200 U.S. financial services executives surveyed by Forbes Insights, about 92% are currently using encryption technology. To stay ahead of hackers, the financial service industry should understand the dangers that lurk outside the organization. The following are some of the top cyber security threats faced by financial services.

  • Web Application Attacks – The financial sector depends on business-critical web applications including Google docs, calculator tools, webmail platforms, and financial records to serve customers and promote their services. Most of these applications are hosted on the web. These can be easily attacked, as they are the most accessible and rely on user input. The types of web application attacks range from buffer-overflows to SQL injections attacks.
     
    Using an intelligent Web Application Firewall (WAF) along with the behavioral firewall will help block cross-site scripting (XSS) attacks. Auditing your databases regularly will help you identify and deal with any vulnerability before they are exploited. It is also essential to clear stored cookies, avoid untrustworthy websites, and scan for viruses and malware.
     

  • DDoS (distributed denial-of-service) Attacks – DDoS attacks slow down websites by making them unavailable to users. 1/3rd of network downtime incidents are attributed to DDoS attacks, which costs businesses financial losses and reputation damages. There are DDoS protection tools and integrated preventative services available. Cisco has produced a helpful guide outlining the different DDoS methodologies and prevention steps. Remotely triggered black hole (RTBH) filtering helps prevent attack traffic before it hits the network. Anycast, a routing methodology routes traffic through various nodes, which in turn dilutes malicious traffic from DDoS attacks. Other tools, such as reputation-based blocking, help identify malicious URLs and establish a database to protect against future attacks.
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  • Third-Fourth-Fifth Party Vendors – Managing the risk of third, fourth, and fifth-party vendors is quite difficult. When you begin working with other vendors, you need to assess the cyber security threats associated with third-party agreements. Even though you are not in control of your third-party vendors, you can decide whether they should remain as your partner. It is crucial to ensure that the vendors you work with have strong security measures in place. Also, ensure that the other parties they work with have secure networks. It can be an extremely complex network, however, assessing and developing a risk management plan is essential to protect yourself from these unknowns.
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  • Global business operation risk – Globalization is the process by which businesses start operating on an international scale, across state lines, in different towns with different languages, regulations, and expectations. This increases operational risk. As a part of assessment, you should ask yourself the following questions:
    • Where are my third and fourth-party vendors located?
    • What regulations are affecting my business and those of my third-party vendors?
    • Are the security risks to my business different in different locations? How so?
    • What security measures do we need in these different regions?
    • Are we expanding? Will our cyber security risks expand as well?

    Then, it is essential to determine whether your team has the resources necessary to ensure protection of consumer data.

  • Insider Threats – Harvard Business Review reports that 60% of cyber attacks come from inside the company. According to IBM report, financial firms and financial services were in the top three sectors targeted by insider attacks. From dissatisfied employees to poorly-compensated bank tellers, 75% of the internal attacks were intentional. These employees can provide their credentials to a hacker or decline to seriously review cyber security concerns due to poor morale. The remaining 25% of internal attacks are due to human error. Phishing scams and malware downloads can work on even the most loyal and hard-working employees.
     
    It is necessary to protect the most valuable data, tighten access controls and make sure that your employees are satisfied and feel valued for their contributions.
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    In addition, financial institutions can consider the following steps to ensure greater data security and minimize legal exposure.

    • Draft internal policies, procedures and contractual provisions regarding the discovery, investigation, remediation and reporting of breaches.
    • Obtain the right insurance coverage for various types of cyber risks and consider the adequacy of existing insurance programs.
    • If possible, partner with a third-party cyber security team that can help manage internet security and prevent cyber attacks as well as data breaches.

    Nowadays, in the financial services sector, data security breaches, DDoS attacks and insider threats are on the rise. However, executives in the industry can take action by outsourcing financial data entry tasks to professional data entry companies. The right data entry outsourcing partner can help minimize cyber security risks.

    About MOS Team

    MOS Team

    Managed Outsource Solutions (MOS) is a leading BPO company committed to providing business process outsourcing solutions for a wide range of industries such as Medical, Legal, Information Technology and Online Media.