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CYBER SECURITY WITHIN THE FINANCIAL SECTOR: HOW MUCH COULD A SECURITY BREACH COST YOUR COMPANY?

In recent years, industries across the board have seen a major increase in data breach cases. Increased reliance on digital data have had a significant impact on the growing prevalence of cybercrime in the modern age. In this post, Steve Thomas, Finance and Project Based Accounting Expert at The Access Group, takes a look at cyber security within the financial services sector, and the potential costs businesses could face.

 

Data stored by any company is of critical importance for both employees and clients, ranging from confidential client information and emails, to orders and payment details. Loss of data can, therefore, result in significant negative repercussions for businesses of all sizes, and this can lead to business failure in some cases. Research shows that 60% of businesses closed operations within the six months following a cyber attack, and attacks of this type are particularly deadly to small and medium-sized businesses.

 

Security breaches are a major problem within the financial sector – mainly due to the sensitive nature of the data being stored – making all businesses in the sector susceptible to such criminal activity. Cyber attacks within this industry often involve attackers targeting backing systems and client accounts. The sensitive and confidential nature of this information means that a data breach can lead to catastrophic consequences for SMEs working in financial services.

 

This subject has gained significant traction within the last year. Data breaches reported by financial services firms to the Financial Conduct Authority (FCA) increased by 480% in 2018, with insurers, investment managers, pension and savings advisors seeing an increase in the number of data breach reports.

 

Research shows that investment banks are more likely to be targeted as victims of a data breach due to the common belief held by cyber criminals that their systems are less sophisticated than that of a retail bank.

 

2018 also saw a significant increase in reports of data breaches from insurers, consumer retail lending and retail investments, and figures show that British bank customers lost over £500m to financial fraud in just one recent six-month period.

 

The repercussions of a data breach in financial industries can be fatal. In a recent report published by the government’s Cyber Streetwise campaign and KPMG, 89% of SME victims disclosed that attacks impacted upon their reputation whilst 30% reported a loss of clients.

 

How can businesses be protected?

Cyber attacks are becoming increasingly sophisticated over time and security breaches continue to plague financial services, with 145 cases reported in 2018 alone. Although no business can completely protect itself from a data breach, certain strategies can be implemented to help prevent cybercrime from occurring.

 

For financial directors, it is vital to ensure that clients and staff are frequently informed about the risks of cybercrime, such as phishing attacks, password hacking and malware and viruses. Encouraging staff to question suspicious requests and ensure that all attacks are reported will help in preventing cyber attacks in the future.

 

The National Cyber Security Centre (NCSC) has produced a guide for SMEs which offers actionable advice and tips on a range of topics such as:

 

  • Configuring accounts to reduce the impact of successful attacks
  • Checking for obvious signs of phishing
  • Reporting all attacks
  • Keeping up to date with attackers

 

Damages and repercussions of cyber attacks in this industry

Currently, the average cost for businesses that have lost data or assets after a breach is £22,700 according to the latest Cyber Security Breaches Survey by the Government’s Department for Digital, Culture, Media and Sport. For an SME, a loss of this amount could be extremely damaging to the business. Attacks of this type do not only affect the financial side of things, but these attacks subsequently impact business reputation, growth, and customer confidence.

 

The NCSC suggests that there’s around a 1 in 2 chance that SMEs will experience a security breach at some point. Therefore it is imperative that small businesses employ the correct security measurements in order to prevent an attack of this scale. By actively eliminating the risk of a security breach, thousands of pounds could be saved and invested back into the business.

 

£22,700 is a lot of money and could fund various assets such as 63 new Dell business desktop computers, 137 new office desks or even 19 years worth of cybersecurity protection. One thing is for sure, the costs of cyber security breaches can be substantial.

 

What would you spend £22,700 on?

 

 

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Finance

AI: CUSTOMER FACING EMPLOYEES’ BEST FRIEND IN THE FINANCIAL SERVICES INDUSTRY

By Ryan Lester, Senior Director, Customer Experience Technologies at LogMeIn

 

We’ve all heard the old saying “money talks.” Well when it comes to customer loyalty and retention, good customer experience talks much louder, with 30% of customers leaving a brand and never returning due to a bad experience.

The truth is, there are a lot of companies with similar products and services, but that doesn’t mean that differentiation is impossible. So, what’s the solution? For financial services, large and small, customer experience is becoming the key competitive differentiator and the best way to deliver an impactful experience is to empower customer-facing employees to do their best work. Artificial intelligence (AI) is enabling these employees to create remarkably better customer experiences, resulting in customer loyalty, advocacy, and overall growth.

For financial institutions that have been considering new strategies for improving the quality and efficiency of their customer experience, here are a few ways AI can enable them to deliver the “human factor” that good customer experience demands whilst ensuring customer facing employees can provide a more positive experience for customers.

 

Increase employee productivity

How much of employees’ time is spent searching for answers to questions? Do they ever have to put customers on hold or even step away to get additional help? AI helps provide front-line employees real-time guidance so they can spend less time looking for information and more time solving problems. An AI-powered chatbot, for example, can be listening in the background of a conversation helping point employees to the right data, solutions, and processes to resolve customer issues faster than ever before.

 

Deliver a consistent customer experience

When banking customers engage with their financial institutions, they measure the speed and accuracy of the service through two criteria. First, how quickly can the system access their account and deliver the correct information? Is it faster than a human could type it in and share it? And second, if they eventually do need to be connected to a live customer support agent, is their information captured and passed along accurately? AI technology takes those general queries off the customer support team’s plate, providing a quick, accurate, and effective response. If a query needs a more in-depth response, AI can hand it off to support staff to address.

Not only this but leveraging a centralised, AI-powered knowledge solution ensures every employee has access to the same, updated information, so no matter who the customer speaks to, they can be assured that employee responses are both consistent and accurate across the board.

 

Accelerating employee training and onboarding

Like any industry, employee turnover is inevitable and can be costly. But, not training new employees correctly or in a timely manner could be much more costly. When it comes to financial services there is a lot to learn, whether it is something simple like the process for checking an account balance to all the nuances associated with mortgage loans. AI can support on-the-job training by helping new employees answer questions confidently, correctly, and much quicker than they could before.

 

Improving employee satisfaction

Today’s banking customer has all kinds of new ideas about their banking experience. “The Amazon Effect” has successfully raised consumer expectations to the extent that a consistent, personal, and relevant experience is the new normal. As a customer, how many times have you been told “I’m sorry, I don’t know the answer?” Customers want solutions to their problems and employees want to be able to deliver those solutions as efficiently and effectively as possible. AI assisting in the background helps minimise those negative moments – making employees job easier, less stressful, and overall more enjoyable.

 

Identify knowledge gaps

Do you know all the questions employees are getting asked? Do you know what’s easily answered and what’s not? Real-time insights allow knowledge managers to keep up to date on frequently asked questions and gaps in current resources. This allows them to strategically improve or add content where needed.

 

Augmenting customer service

Whether talking with an AI chatbot or a personable customer service team member, the modern banking customer has high expectations for convenience, speed, and security. Which means that the technology you choose to deploy and how you deploy it is now just as important as who you hire and how you train them.

Today’s AI solutions won’t replace customer service agents or get in the way of the human factors that drive the customer experience. On the contrary, they augment it, allowing the business to do more without adding human resources. The higher the quality of a AI chatbot solution, the better it will be at taking the routine requests off the plate of customer service agents—giving them more time to provide a personalized and positive experience for customers.

 

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Technology

BEFORE THE INK IS DRY: CORRECTING BIOMETRIC SPOOFING MYTHS

Eric Setterberg, System Design Engineer at Fingerprints

Biometric authentication is highly robust, and the latest solutions offer considerably greater security than their authentication predecessors: PINs and passwords.

But as biometrics moves into new areas such as payments and access control, privacy and security concerns are rising. Biometrics has long been subject to scrutiny, with many elaborate examples of people working to trick biometric sensors to crack devices in the media and online.

To ensure the continued adoption of biometrics, it is important to shine a light on the reality of biometric spoofing.

 

The Evolution of Biometric Solutions…

The first use of fingerprints as forensic evidence was in an Argentinean court case in the late 1800s. With the technology still in its infancy, this was done manually and by eye, comparing latent residual prints lifted from crime scenes to charts of inked fingerprints obtained from the suspects at arrest.

A few decades later, the FBI began collecting fingerprints of criminals and civilians. They also introduced the automated comparison of fingerprints by computers in the 1970s. These “traditional representations” have now been standardized by ISO and ANSI.

… and their Spoofs

The earliest and simplest of these matching devices were easy to spoof. Really, all you needed was a photocopy or a good image of a fingerprint to make a successful spoof.

But as biometrics moved to more advanced technology, the game for biometric ‘spoofers’ has changed and the task of crafting fake fingerprints is considerably more difficult.

The biggest boost for biometric security, however, came with its introduction into mobile phones.

 

How Mobile Changed the Game

Before the widespread integration of fingerprint sensors in smartphones, the technology underwent significant evolution. No operator wanted to use large biometric sensors in modern phone designs. Sensors had to become much smaller to reach the perfect price and design point for the mobile world, but this meant needing to capture data from a smaller surface area of the finger.

To maintain the security of these smaller sensors, algorithms evolved significantly in order to utilize a greater amount of data per unit area. These mobile-driven hardware and software changes resulted in the optimized image capture of modern touch sensors.

As a result, tricking these systems now requires a considerably higher level of detail to be reproduced correctly for a match to be successful, far beyond rudimentary gummi bear spoofs and photocopies

 

Setting the Perfect Spoofing Scenario

Compromising fingerprint authentication via spoofing can still be done, even with all the technological advancements. However, it now requires considerable care, skill, money, and time. And to start, a good latent print…

To retrieve a latent print that’s high quality enough to work, you either need a willing volunteer to lend you their finger, or the commitment to stalk a victim until a viable fingerprint can be retrieved. Even with a decent latent print, modern spoofs then require advanced photoshop skills and/or a lab to successfully convert latent prints into effective moulds.

So – what about those articles boasting how easily they have hacked the latest smartphone device’s fingerprint sensor?

In fact, there are only two instances of fingerprint spoofing seen in the media nowadays: proof of concept and cooperative spoofs. Lay enthusiasts and media go through the effort of setting up a lab to create spoofs with latent fingerprints either from themselves or cooperative volunteers. Even the most successful of these take months of work, a highly skilled team, and the perfect scenario of circumstances.

Put simply, the effort required for spoofing modern fingerprint sensors cannot be applied at any scale. Each biometric spoof needs to go through the same laborious process and clinical conditions. So, if you can bring together a willing group of spoofing enthusiasts, tricking a biometric device could earn you fifteen minutes of fame on the internet, but it is likely to be conducive to a successful criminal business plan…

 

A “How” Without a “Why”

Spoofing biometrics remains technically possible, and there will always be those up to the challenge of trying to hack the latest technology. But the reality is that modern biometric solutions require more time, skill, and frankly, luck, to successfully spoof than ever before. Not to mention that tireless R&D work is continuously strengthening spoofing resistance. And, as use cases start to combine multiple biometric authenticators, such as combining fingerprints with face or iris to perform an authentication, spoofing will only become more complex.

By comparison, hacking PINs and passwords is considerably simpler and more scalable, making it far more lucrative. And, criminals generally take the path of least resistance.

For the average consumer, greater use of biometric authentication is not only a means of simplifying authentication, but dramatically improving the security of their devices, applications, and personal data. With PINs and passwords still the most common authentication method outside of mobile, it is imperative that the true security and advanced nature of modern biometric authentication solutions are understood.

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