The connection between cybersecurity and poet Ralph Waldo Emerson is not directly evident, however he once said, “money often costs too much.”
This statement rings true across the financial services industry, as money is a key driver for cybercriminals acting with malicious intent. The always-on eye of Sauron on the financial services industry means there are greater implications to keep this industry safe as a top target – and to keep money where it belongs.
IT teams across these organizations have historically invested heavily in technology stacks to combat fraud and decrease the likelihood of an attack or breach, but attacks keep getting more sophisticated and frequent. This Sisyphean task of keeping up with modern-day breaches is complex, and protecting the money is costly, as Ralph’s quote woefully reminds us.
McAfee’s “Hidden Costs of Cybercrime” report supports this current state of the financial services industry, indicating that these organizations spend up to $3,000 per employee on cybersecurity. Another survey from the Financial Services Information Sharing and Analysis Center (FS-ISAC) found that, depending on company size, financial institutions spend between 6% and 14% of IT budgets for defense.
This spending shows no sign of stopping as organizations will always have the onus to protect data, employees, and their own bottom lines. As long as cybercriminals exist, the need for cybersecurity will be omnipresent. However, there is a major change the financial services industry can implement to manage threats faster with higher efficacy and become more proactive instead of reactive: Extended Detection and Response (XDR).
Couldn’t Stop Past Breaches? Time to Stop Future Ones
It’s been less than 10 years since JPMorgan Chase & Co. fell victim to the largest known cyberattack at the time – one that occurred two months after it had vowed to spend a quarter-billion dollars a year on cybersecurity. Due to the breach, they increased the planned spend to half a billion dollars, per Forbes. Similarly, Capital One Financial Corp. more recently agreed to pay an $80 million dollar fine, pledging also to increase its cybersecurity efforts as a result of a breach that disclosed more than 100 million customer records.
Both of these financial institutions present examples where XDR could have provided a benefit and perhaps thwarted these major breaches. With its ability to coordinate systems and processes as well as automatically aggregate threat analysis and remove manual hunting and analysis, XDR acts as a modern-day catalyst for security operations center (SOC) success. This combination of prevention, detection, analysis, and response across the SOC and enterprise allows for better decisions that are made faster.
Taking a closer look at the JPMorgan breach, it was only uncovered due to a routine and typical scan conducted by the SOC team. Hackers were able to infiltrate using custom malware and a previously unknown flaw, entering via a website owned by JPMorgan to then stealthily extract data over the course of months – all without being caught by SOC teams. This is not uncommon, as recent Ernst & Young research cited that only 26% of the SOCs polled identified a threat event.
XDR’s ability to control access across an organization’s entire infrastructure from a unified and coordinated interface, coupled with more interconnected visualization across the SOC, provides the context needed to look at cybersecurity in a holistic manner. This is critical given the erratic lateral movements of advanced threats. This means all vectors are protected together, from endpoint, network, and the cloud; therefore, providing better context and overall awareness of security posture across an entire organization.
Breaches are a Promise, Losses Don’t Have to Be
This gift of proactivity empowering the SOC to act quicker cannot come at a better time as threat actors are still leveraging the upheaval COVID-19 wrought to take advantage of vulnerabilities created due to the pandemic. Not to mention, companies and employees are not clamoring to return to the office where endpoints are easier to track and manage.
The National Association for Business Economics found that only about 1 in 10 companies expect all employees to return to their pre-pandemic work arrangements. With employees apt to use personal devices, causing an ever-increasing endpoint explosion, hackers may again have an easy entry point to conduct crime. All industries are vulnerable, but the financial services industry remains forever-lucrative due to the monetary gains that could be achieved.
With an increase in virtual transactions and use of personal devices to conduct business, the industry is ripe for phishing attempts, malware, and ransomware attacks. Hackers are taking advantage of these surges, with McAfee and IC3 data indicating that business email compromise (BEC) scams have been increasing. This means, it may not take a zero-day approach or strategy from hackers to infiltrate if existing systems and solutions already prove insecure.
Cost is often a barrier to entry for many industries, but the financial services industry has shown it is committed to investing in cybersecurity, knowing it has the most to lose. There has been success across the industry due to this guarantee, but the breaches that do get thwarted do not make the headlines. Nonetheless, undetected breaches – and the reputation-damaging headlines that appear alongside them – lead to more information and data loss and disruption to business. For financial institutions seeking to eliminate the losses associated with cybercrime, XDR is worth exploring.