11 February 2016

US Treasury calls on financial sector to step up cybersecurity planning

17 July 2014  |  5178 views  |  0 Washington Capitol hill

A top US Treasury official has called on the financial services sector to step up its efforts to protect consumer privacy and critical infrastructures from the threat of cyber attacks.

In remarks at a conference organised by Seeking Alpha, US Treasury Secretary Jacob Lew said that cyber attacks on the financial system compromise market confidence, jeopardise the integrity of data, and pose a threat to financial stability.

"The consequences of cyber incidents are serious," Lew told his audience. "When credit card data is stolen, it disturbs lives and damages consumer confidence. When trade secrets are robbed, it undercuts America's businesses and undermines US competitiveness."

Financial sector trade groups - including the Financial Services Roundtable (FSR), the Financial Services Forum (FSF), the Securities Industry and Financial Markets Association (SIFMA), The Clearing House (TCH) and the American Bankers Association (ABA) - responded to Lew's remarks, insisting that the industry was leading the way in combating cyberattacks.

"With extensive collaboration within the industry and the federal government, the financial industry closely monitors the changing threats and adapts to stay ahead," the lobby said in a prepared statement. "We also urge Congress to quickly pass cyber threat information sharing legislation to further enable us to expand our abilities to fight future attacks."

Lew said that the financial sector should adopt the Administration's new voluntary cybersecurity framework for their own systems and as a way to evaluate outside vendors.

However, he acknowledged the need for more legislative action.

"As it stands, our laws do not do enough to foster information sharing and defend the public from digital threats," said Lew. "We need legislation with clear rules to encourage collaboration and provide important liability protection. It must be safe for companies to collaborate responsibly, without providing immunity for reckless, negligent or harmful behavior."

Sifma has proposed a government-industry cyber war council to stave off terrorist attacks that could trigger financial panic by temporarily wiping out account balances, according to an internal document discovered by Bloomberg.

"We are concerned that the industry may not have the capabilities that we would like to effectively defend against this newer form of potential attack, the capability that we would like to stop such an attack once commenced from spreading to other financial institutions, or the capability we would like of effectively recovering if an initial attack is followed by waves of follow-on attacks," the document says.

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