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FIs see pandemic spike in cybercrime; banks cut security budgets

FIs see pandemic spike in cybercrime; banks cut security budgets

Nearly three quarters of financial institutions have seen a rise in cybercrime since the Covid-19 pandemic began, according to a survey from BAE Systems.

The survey of 902 banks and insurers in the US and UK shows that this uptick is also having a monetary impact. More than half of respondents saw an upsurge in financial losses over the last 12 months - the average cost reaching $720,000 and rising.

On causes, the research identifies concerns about the new-normal working from home model, with 42% saying that remote work has made them less secure. Just under half are also concerned that this has led to less visibility of potential holes in their network or infrastructure and a further 37% believe their customers are now at greater risk of cybercrime or fraud.

Despite this growing problem, IT security teams are feeling further pressure from decreased budgets and team redundancies. On average, budgets within IT security, cybercrime, fraud and risk departments have been slashed by a quarter and 40% have had to cut back on critical IT security technology spend. Alongside this, more than a third have had to reduce the number of people in IT security teams over the past 12 months.

BAE also quizzed over 2000 consumers on cybercrime: More than a quarter say they had been sent an email hoax relating to Covid-19, with 22% also being targeted by text or SMS. Even when refunded, the average amount of money stolen by cyber criminals was $1,174. For those who didn’t see their money again, the average money lost was a significant $743.

A spike in online shopping during the pandemic has also driven increasing cybercrime. More than a quarter say they have bought something from a fraudulent site in the past 12 months and never received their goods.

More than half believe it is the job of the banks to protect them, compared with 40% that believe it is their own responsibility. More than half also say banks or credit card providers could provide more guidance to consumers on how to behave online to be better protected from cyber crime.

Adrian Nish, head, cyber, BAE Systems Applied Intelligence, says: “We’re noticing a clear collaboration emerging between different groups of criminals across the wider landscape of serious and organised crime. Fraudsters and cyber criminals seek to exploit fear, uncertainty and change, and the pandemic has offered them new opportunities to probe for weaknesses they can monetise and new ways to disguise their activity.

“Attackers are building increasingly advanced capabilities to target core banking systems and becoming more aggressive, harming victims’ ability to respond to attacks. Online criminals have reacted fast, adapting their approach to hunt out remote working security gaps and prey on the vulnerable.”

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