US financial sector to test bird flu response
25 May 2007 | 9509 views | 0
The US financial services industry is to conduct a market-wide business continuity and disaster recovery test to assess the sector's readiness for dealing with an avian flu pandemic.
The sector-wide exercise, which will be the first of its kind in the US, will begin on 24 September and last for a number of weeks in order to simulate a full pandemic wave. Participants will take part in the tests from their own office locations using e-mail and a secure exercise Web site.
Goals of the exercise include identifying systemic risk to the sector, allowing participants to test individual plans against a realistic scenario and clarifying the ripple effects of a pandemic within the industry.
All financial industry sub-sectors will be represented and the exercise will also involve advisory group representatives from sectors such as power and telecommunications, as well as critical agencies such as the Centers for Disease Control and Prevention (CDC).
The Financial Services Sector Coordinating Council for Critical Infrastructure Protection and Homeland Security (FSSCC) is sponsoring the event in partnership with the US Treasury Department and the Financial and Banking Information Infrastructure Committee (FBIIC). The Securities Industry and Financial Management Association (SIFMA) is also playing a key planning and project management role.
George Hender, chairman of FSSCC, says the unprecedented exercise will help prepare the financial services industry to respond in the best possible way to a pandemic event: "Ensuring the financial sector can meet the challenge of all types of disruptions with minimal impact is critical."
Earlier this month, the US government's watchdog agency warned that some key financial markets participants are still not fully prepared for dealing with an avian flu outbreak and called on regulators to set deadlines by which firms should have contingency plans in place.
The Government Accountability Office (GAO) said although firms have improved physical and information security measures, most are not fully prepared for dealing with a severe outbreak of bird flu and may fail to consider the potential scenarios associated with a pandemic.
The US exercise is similar to tests conducted in London's financial district last year which found that absence rates at financial firms could top 60% in some business units in the event of a bird flu outbreak, with heaviest impact on customer-facing retail financial services.
Following the exercise many UK firms were forced to re-evaluate contingency strategies in specific areas including "human resources, third party dependencies, outsourced ancillary services, suppliers, operational priorities and communications" to ensure businesses remain open in the event of a pandemic.