Cyber robbers want cold, hard cash—and they’re finding it at small banks, credit unions

Under constant, though unpublicized, attack, financial institutions find some relief by turning to managed security services

 
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Bankers abhor any pub­lic air­ing of details of net­work breach­es, or worse, suc­cess­ful cyber robberies.

Hard met­rics are not avail­able, due to the closed nature of the finan­cial ser­vices sec­tor. But make no mis­take, the finan­cial ser­vices sec­tor remains under relent­less cyber attack.

In the 13 years I’ve been writ­ing about cyber­se­cu­ri­ty, there has nev­er been any short­age of mat­ter-of-fact dis­cus­sions in the cyber­se­cu­ri­ty and law enforce­ment com­mu­ni­ties about the intense, ongo­ing prob­ing of bank­ing sys­tems globally.

I took this up with Bri­an Solda­to, NSS Labs’ senior prod­uct man­age­ment direc­tor, when we sat down for a chat at RSA 2017. And he con­firmed that sur­veil­lance gath­er­ing and net­work breach attempts against finan­cial ser­vices firms occurs 24÷7÷365.

Bri­an Solda­to, NSS Labs senior prod­uct man­age­ment director

Banks of all sizes targeted

The biggest multi­na­tion­al banks, as well as the tens of thou­sands of com­mu­ni­ty banks and cred­it union type of insti­tu­tions in the Unit­ed States and across the globe are being tar­get­ed, Solda­to says.

NSS Labs is in a posi­tion to know. One of the main ser­vices the Austin, Texas-based secu­ri­ty con­sul­tan­cy pro­vides is its Cyber Advanced Warn­ing Sys­tem, or CAWS, a sophis­ti­cat­ed radar for cyber threats used by large enter­pris­es to mon­i­tor the ebb and flow of mali­cious attacks mov­ing across the internet.

Once in a while, detailed infor­ma­tion sur­faces about what a cut­ting-edge finan­cial sec­tor attack looks like. That hap­pened this week at Kasper­sky Lab’s annu­al Secu­ri­ty Ana­lyst Sum­mit, an exclu­sive, invi­ta­tion-only event, held this year at a glitzy resort on the Caribbean island nation St. Maarten.

Relat­ed info­graph­ic: Attack­ers hit big and small finan­cial firms

Kasper­sky researchers dis­closed how for five hours one day last Octo­ber, a hack­ing ring grabbed com­plete con­trol over all major oper­a­tions of a multi­na­tion­al bank. The bank was not named, except to say that it has $25 bil­lion in assets, 5 mil­lion cus­tomers, and 500 branch­es in Brazil, Argenti­na, the Unit­ed States, and the Cay­man Islands.

The cyber thieves—believed to be part of a Brazil­ian crime ring—toiled for five months in prepa­ra­tion to set up this five-hour coup d’état. They suc­ceed­ed in inter­cept­ing the bank’s entire online bank­ing, mobile, point-of-sale, ATM and invest­ment transactions.

Thieves, good guys play cat and mouse

This dis­clo­sure resound­ing­ly affirmed what Solda­to and I dis­cussed. “The gaps are still out there,” he told me. “It’s much more dif­fi­cult to stay ahead of these threats today, as com­pared to a few years ago, because they’re con­stant­ly evolving.”

While big multi­na­tion­als rep­re­sent the biggest pay­days, and thus attract the most sophis­ti­cat­ed attacks, com­mu­ni­ty banks and cred­it unions are attrac­tive to crim­i­nals for anoth­er rea­son: they tend to be less well-defended.

Thus local banks and cred­it unions have become the prov­ing grounds for less expe­ri­enced cyber rob­bers who show ini­tia­tive by mak­ing good use of old­er generation—but still very effective—hacking tools and tech­niques, Solda­to says.

Here are a few oth­er take­aways about the expo­sure faced by finan­cial sec­tor SMBs, name­ly com­mu­ni­ty banks and cred­it unions:

• Seek­ing help from MSSPs. It’s typ­i­cal for a small bank to rely on basic net­work defense sys­tems, when what’s need­ed is round-the-clock analy­sis of every bit of traf­fic hit­ting the institution’s net­work. Mali­cious probes and com­mu­ni­ca­tions with crim­i­nal com­mand-and-con­trol servers are non­stop. Under­stand­ing and being able to detect mali­cious traf­fic is key. To address this, small insti­tu­tions are increas­ing­ly turn­ing to a man­aged secu­ri­ty ser­vice provider to sup­ply this expertise.

• ATMs exposed. Kasper­sky researchers this week also dis­closed details about how attack­ers were able to com­pro­mise a bank’s net­work in such a fash­ion so as to be able to remote­ly com­mand ATMs to dis­gorge cash. It may be just a mat­ter of time before this tac­tic catch­es on with small­er U.S. banks and cred­it unions, many of whom oper­ate ATMs using the ancient Win­dows XP oper­at­ing sys­tem, which Microsoft no longer sup­ports. “It’s very easy for an attack­er to buy a gener­ic vul­ner­a­bil­i­ty off the Inter­net and tar­get that cred­it union or those com­mu­ni­ty banks with it,” Solda­to says.

• Ran­somware risk. Ran­somware attacks direct­ed at the finan­cial ser­vices sec­tor more than tripled in 2016 vs. 2015, most­ly against small­er insti­tu­tions. Besides fail­ing to ade­quate­ly defend against this vir­u­lent form of cyber extor­tion, many small­er banks and cred­it unions don’t have nim­ble back­up and dis­as­ter recov­ery rou­tines in place. “It’s very com­mon for them to end up hav­ing to pay the ran­som because it’s actu­al­ly faster for them to get back online by pay­ing than it is for them to try to recov­er their sys­tems,” Solda­to says.

There are 6,000-plus com­mu­ni­ty banks and near­ly 7,000 cred­it unions in the Unit­ed States. Those under the most pres­sure to beef up defens­es against cyber rob­bers are the ones with $50 mil­lion or less in annu­al rev­enue, Solda­to says.

Solda­to told me he expects small­er insti­tu­tions to increas­ing­ly turn to man­aged ser­vices providers for help. To hear more, lis­ten to the accom­pa­ny­ing podcast.

More sto­ries relat­ed to hack­ers’ hits on finan­cial systems:
At new eATMs, cus­tomers can get cash with­out a card—and so can hackers
Small banks, cred­it unions on front lines of cyber­se­cu­ri­ty war
Small banks and cred­it unions increas­ing­ly under cyber attack