Arthur J. Gallagher's ransomware attack highlights the threat financial institutions face amid lockdown restrictions
- Global insurance broker giant Arthur J. Gallagher suffered a ransomware attack last Saturday.
- Amid the increased cyber risk financial institutions are facing during the pandemic, cyberspecialist partnerships could bolster defenses.
- Insider Intelligence publishes hundreds of insights, charts, and forecasts on the Fintech industry with the Fintech Briefing. You can learn more about subscribing here.
The US-based insurance broker has disclosed that it temporarily shut down global systems following a ransomware attack on Saturday, per Intelligent Insurer.
The insurer acted decisively, not only taking its systems offline, but also launching an investigation and employing an external cybersecurity firm to address the issue. Gallagher stated that although the investigation is in its infancy, the attack initially seems to only have impacted a limited part of its operations, and the insurer does not expect that it will lead to a material impact on its operations, nor its finances. Gallagher restarted its global systems on Monday.
The ransomware attack is the latest in a long line of cyberattacks against financial institutions (FIs), which highlights the burgeoning threat they face amid lockdown restrictions. Large FIs' sizable total assets and vast amounts of customer data make them attractive targets—and as a result, malware attacks against FIs amounted to 25% of total global incidents in 2019, a higher proportion than any other industry.
For example, US bank Capital One suffered a major data breach which comprised approximately 100 million of its US and Candian customers' credit card information in 2019 and was subsequently fined $80 million by US regulators.
What's more, the cyber threat has heightened during the pandemic, with online activity surging: Employees are working remotely and customers are migrating to digital channels to use FIs' services. Underscoring the severity of the risk, the US Security and Exchange Commission issued a warning to US FIs in July regarding the heightened threat of ransomware attacks.
FIs need to address the growing cyber threat by immediately bolstering their defenses—and partnering with cyberspecialist firms can do this effectively. Global FIs face an average annual cost of $18.5 million to address and contain cyberattacks, which is 40% greater than the average cost across industries. Yet only 34% of global FIs were deploying AI solutions to combat cyber risks in 2019, even though AI-powered solutions are needed to keep pace with the constantly evolving nature of cyber threats and their increasingly sophisticated nature, per Accenture.
To better combat this proliferating threat, FIs should partner with cyberspecialist firms to deploy their digitally enhanced cybersecurity solutions. Partnering with cyberspecialists instead of building solutions in-house presents the opportunity to quickly roll out solutions to meet an immediate need. For example, UK- and US-based cyber security firm Darktrace deploys an AI-powered platform that identifies and responds to cyber threats in real time.
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