Forget the financial crisis, the banking industry is terrified a hack will wipe it out

Written as editor of the New Statesman’s NS Tech and first published here.

It’s really not often an industry report will terrify you – but TheCityUK‘s new ‘Cyber and the City: Making the UK financial and professional services sector more resilient to cyber attack’ should come close.

The industry body for the City of London’s financial services and associated professions reckons we can forget the 2008 financial crisis as the key moment when the banking industry was moments away from collapsing – it’s cyber attacks from criminals to governments that isn’t being taken seriously enough in the boardroom.

“The very things that customers value – round-the-clock access their money, single sign-on, one-click purchase – have created new path for criminals and shared dependencies for the financial system,” explains the group’s chairman, John McFarlane, who’s also chairman at Barclays.

“We in the financial and related professional services sector need to act with the urgency of knowing that a large, systemic risk is upon us. That means individual firms acting to make themselves safe and ready to recover. It also includes the industry acting collectively to make the system safe.”

You only need to look at today’s ‘cyber information sharing landscape’ from the report to understand there might be a potential for things to turn bad, quickly.

Cyber reporting

To make matters worse, the chair of TheCityUK’s Cyber Taskforce Mark Weil points out that there is no potential for a cash injection from a finance minister to save banks this time.

The group gives a hat-tilt to government plans announced in March to open a National Cyber Security Centre but that’s only going to open in October.

He also states that, just as in pre-2008 when credit risk wasn’t an issue on the boardroom table, cyber is still something that’s a faraway technical team’s problem.

Fortunately, the report offers lots of practical advice, including a (it really can’t be that simple?) simple ‘board cyber check-list’.

Board check list

Poppy Wood, chief of staff for London’s cyber security accelerator Cylon, told NS Tech: “We warmly welcome this report, and specifically the encouragement it gives for our major City institutions to support UK-based cyber security companies and entrepreneurs.

“As early customers and proving grounds for innovative technologies, City institutions can make a huge difference to the UK cyber sector.”

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