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Financial firms face losses of £742,000 on average for each cyber security incident they face, a survey of finance professionals by security firm Kaspersky Lab and B2B international has revealed.
The most costly threats for financial organisations are those that exploit vulnerabilities in point-of-sale (POS) systems, which typically result in losses of around £1.6m.
Attacks on mobile devices are the second most costly at around £1.3m, followed by targeted attacks which cost around £1m.
Compliance is the main driver for increasing investment in IT security in banks and financial institutions. However, the study found that 61% of UK organisations believe that being compliant is not enough to be secure.
Another significant reason for spending more on security is growing infrastructure complexity. For example, most financial firms are adopting virtual desktop infrastructure (VDI) and manage around 10,000 user devices on average, with roughly half being mobile smartphones and tablets.
Insufficient internal expertise, top management directives and business expansion are also among the top reasons for a budget increase.
The research report said that in general, investing more in security appears to be inevitable for a majority of financial firms, with 82% of them expecting an increase in their IT security budgets.
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“It is not surprising that financial organisations are looking to increase spending on security, given the substantial potential monetary losses from cyber attacks,” said David Emm, principal security researcher at Kaspersky Lab.
“Successful security strategies lie not just in spending on compliance, but in a multitude of cyber security solutions to minimise unauthorised access. This includes paying more attention to personal security awareness, getting better insights on industry-specific threats and investing more in protection from advanced targeted attacks,” he said.
The study shows that UK financial firms seek to address security challenges by getting more threat intelligence and conducting security audits, with 75% considering this measure effective. However, organisations in the financial sector are less inclined to use third-party security services, with only 52% of those surveyed perceiving it as an effective approach.
Read more about threat intelligence
- Threat intelligence tools are a growing market and enterprises need to be able to see through the hype to get the best product for them.
- Threat intelligence is quickly becoming an essential ingredient for protecting corporate systems and data.
Kaspersky Lab recommends five key considerations for security strategies adopted by financial organisations in 2017:
1. Beware of the targeted attacks
Targeted attacks on financial organisations are likely to be conducted through third parties or contractors. These companies can often have weaker or no protection at all, and can be used as an entry point for malware or a phishing attempt.
2. Do not underestimate less sophisticated threats
Fraudsters can strike at mass and benefit from the scale using the simplest tools. Social engineering might contribute to 75% of fraudulent incidents, while only 17% could be caused by malware.
3. Do not choose compliance over protection
Budgets are usually allocated in favour of compliance, but strengthening security and introducing new protection technologies requires a more balanced approach to the allocation of resources.
4. Carry out regular penetration testing
Unseen vulnerabilities are nevertheless real. With the implementation of sophisticated detection tools and penetration testing, vulnerabilities and incidents will emerge.
5. Pay attention to insider threats
Employees can be exploited by cyber criminals – or decide to become one. Effective security strategies should go beyond perimeter protection to include techniques that can detect suspicious activity within organisations.