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Higher risk of cyber attacks for wealth managers, says global wealth report

Jun 29 2019 15:15
Compiled by Carin Smith

Cybersecurity continues to challenge wealth managers, according to a global wealth report released by Boston Consulting Group (BCG).

"Wealth managers face an increasing number of cyber attacks - from insider attacks and fraud, but also from external sources," states the report.

The report found that in one incident a so-called smokescreen attack disrupted a bank's operations for two weeks.

Attackers wiped thousands of computers at hundreds of branches. All this was actually just done as a mask to hide millions in fraudulent transfers.

In another instance stolen credentials were used to siphon $60m from customer accounts. Credentials to initiate money transfers were harvested over time via PC malware.

Another example given in the report is of a bank employee who stole 1.5 million customer records and shared it with a criminal third party.

"The Titanic problem of wealth managers regarding cybersecurity is that they pay too much attention on technology and not enough on people, processes and organisation," states the report.

"Most wealth managers are only partially prepared to meet the upcoming challenges. They have limited awareness of the evolving threat landscape and challenges."

They also have limited understanding and monitoring of cyber risk along the full value chain.

Year of challenges

The report further found that 2018 was a year of challenges for wealth managers. The equity markets had the worst year in a decade.

"Returning to sustainable growth should be the key item on the agenda for years to come," states the report.

"In wealth management, one single approach for all markets and segments has not proven to be a winning strategy. Banks need to sharpen their focus by making key strategic decisions."

wealth  |  cyber security  |  financial services
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