PYMNTS-MonitorEdge-May-2024

The Biggest Banks In The US Team Up To Take On Cybercrime

In something of a Team of Rivals move – the biggest baks in the United States are teaming up to take on the ever-increasing population of cybercriminals trying to hack them.

Involved in the partnership are J.P. Morgan Chase & Co., Bank of America Corp. and Goldman Sachs Group Inc., among others. The early goals of the group will revolve around information sharing – and making sure that a threat that appears against one (or a few) entities can be contained quickly through knowledge.  The alliance will also make it possible for the banks to jointly prepare and “conduct war games” to test-run cybercrime fighting tactics.

This group is a part of a smaller subgroup of banks around the world that work collectively to take on cybercrime in its main forms – but the group is very large (7.000 members) and the superbanks of the U.S. felt they needed a more specialized outlet that reflects the simple fact that they are the most desirable targets to the world’s hacker population.

Cyberattacks were endemic across U.S. industry in 2015 – and financial services institutions were hit the third most, according to data released by IBM earlier this year.  JPMC saw its systems attacked and the personal information (names, addresses, etc) of around 76 million of their customers taken.

On the upside – no money was stolen.

This is not the first effort at joint cooperation. The Cybersecurity Information Sharing Act – a federal law that aims to make it easier for private companies to share cyberthreat information with the government – has been somewhat controversial among FIs as they argue that it creates another layer of paperwork and expense in cyberecrime fighting programs that already cost billions to manage and maintain. Banks have also complained that through the law they are likely to disclose more information than they ever actually receive about various threats.

“We are working very rapidly to declassify everything we can to push it out as quickly as we can to all of our partners,” said Phyllis Schneck, Deputy Undersecretary for Cybersecurity at the Department of Homeland Security.

Other bank executives have complained the information they provide is less than securely stored.

“There are still a lot of questions about the new law,” said Nubia Shabaka, executive director in the legal and compliance division of Morgan Stanley at a legal financial-services conference in June.

The new banking group will operate under the auspices of  the Financial Services Information Sharing and Analysis Center.

“They are trying to provide a support mechanism for deeper information-sharing and collaboration on top of whatever is already going on today,” said John Carlson, chief of staff at the FSISAC.

The government has provided additional guidance about the new law since it was enacted in December.

”The sharing is only really just beginning,” Ms. Schneck said.

PYMNTS-MonitorEdge-May-2024