Washington DC
02 November 2017
Reporter: Stephanie Palmer-Derrien

“No greater threat” than cyber, says SIFMA

Cybercrime poses a serious threat to financial stability, according to Kenneth Bentsen, president and CEO of the Securities Industry and Financial Markets Association (SIFMA).

Testifying before the US House of Representatives committee on financial services subcommittee hearing on data security, Bentsen said: “There is likely no greater threat to financial stability than a large-scale cyber event.”

The financial services industry, in particular, is a top target, facing tens of thousands of attacks every day, he said, adding that an attack on the industry could have serious ramifications.

He said: “While data breaches of customer information dominate headlines, and are an appropriate concern for policymakers, a major cyberattack on critical financial market infrastructure or one that destroys records and financial data, is a risk with a potentially far larger impact on the economy.”

Improving harmonisation of regulatory standards and supervision could play a large part in tackling this risk. The emergence of several different regulatory regimes has meant industry resources have been diverted towards compliance, rather than to security itself.

Collaboration between industry players and regulators is key here, Bentsen said.

“It is important to recognise that no single actor—not the federal government, nor any individual firm—has the resources to protect markets from these threats on their own.”

“It is critical that we establish a robust partnership between industry and government to mitigate cyber threats and their impact. The industry’s resiliency will not be fully effective without the government’s help, and vice versa.”

He highlighted the importance of stringent data protection, raising concerns around the Securities and Exchange Commission and self-regulatory organisations’ (SROs) Consolidated Audit Trail (CAT), suggesting that the latest CAT technical specifications have included “alarmingly few details on data security and protection”.

Finally, Bentsen stressed that SIFMA is working closely with the securities industry on developing best practices for cybersecurity, and noted that security is a “combination of activities that relies on strong defences, information sharing, mitigation and recovery planning”.

He said: “The securities industry is constantly working to improve cyber defenses, resiliency and recovery through massive monetary investment in technology and personnel, regular training, industry exercises, and close coordination between the financial sector and the government, including our regulators.”

More news
The latest news from Asset Servicing Times
Join Our Newsletter

Sign up today and never
miss the latest news or an issue again

Subscribe now
OFI AM and SETL become shareholders of IZNES
23 February 2018 | Paris | Reporter: Jenna Lomax
OFI AM and SETL have been joined as shareholders of IZNES by five asset management companies
Klesia Finances goes live with NeoXam’s Density solution
23 February 2018 | Paris | Reporter: Jenna Lomax
According to Klesia, Density will assist it in facing the current French and European regulatory landscape
EBA Clearing’s RT1 hits 500,000-transaction-mark
23 February 2018 | London | Reporter: Jenna Lomax
The RT1 system passed the transaction milestone on 19 February
Liz Daniels joins FCA
23 February 2018 | London | Reporter: Becky Butcher
The Financial Conduct Authority has appointed Liz Daniels as policy advisor
Gen II exceeds $175 billion in assets under administration
23 February 2018 | New York | Reporter: Becky Butcher
Gen II Fund Services has revealed that its assets under administration have exceeded $175 billion
SANNE hires Hannah Correll Jaeger
22 February 2018 | New York | Reporter: Becky Butcher
SANNE has appointed Hannah Correll Jaeger as head of client relationship management for the Americas to support the company’s growth
Benelux trio set to strengthen collaboration on blockchain
22 February 2018 | Brussels | Reporter: Becky Butcher
B-Hive, the Luxembourg House of Financial Technology and the Dutch Blockchain Coalition have signed a memorandum of understanding to strengthen further collaboration in blockchain within the Benelux region
More news