As global tensions flare, cybersecurity will become an even more important concern for financial institutions.
Russian hackers may have slipped past JPMorgan Chase’s digital barricades earlier this month to retaliate against U.S. imposed sanctions.
The breach – whatever the source – resulted in the loss of significant data about the bank’s customers, including checking and savings account numbers. While JPMorgan JMP -0.43% has tried to calm fears (so far, it has not seen any usual fraud activity), the concern lingers for all U.S. banks and their clients.
As worldwide tensions grow, cybersecurity breaches will inevitably continue to plague financial institutions.
“In the world of globalization, we will continue to see that for every real world government action, there will be a cyber reaction,” said Carl Herberger, vice president of security solutions at Radware RDWR 0.00% .
The Federal Bureau of Investigation is still digging into the hacking, so the motivation behind it is still unknown. Officials said the attack could be retaliation for Russian sanctions imposed by the U.S. in response to the country’s invasion of neighboring Ukraine.
This wouldn’t be the first time a country hacked U.S. banks in response to an international tiff.
Banks have fought off a series of politically-motivated cyberattacks from Iran over the past two years. A group of Iranian hackers attacked a number of banks including Bank of America, Citigroup and Wells Fargo with distributed denial of service attack. A method where the hackers inundate banks sites with online traffic, causing the websites to drastically slow down and even collapse for periods of time.
Officials said the attacks were in retaliation to a series of economic sanctions implemented by the U.S. and other Western allies. Citigroup warned in its most recent annual report that such cyber incidents “could occur more frequently and on a more significant scale.”
“Additional challenges are posed by external extremist parties, including foreign state actors, in some circumstances as a means to promote political ends,” the bank said.
Banks often are not able to predict how political policy will impact their online security, but it shows the importance of investing in technology that can detect and fight these threats before they happen, according to Herberger. As political tensions grow, banks need to “exercise extreme care with their security postures,” he said.
Citigroup, Wells Fargo and JPMorgan are heeding that advice. Citigroup and Wells Fargo both went into detail in their most recent annual reports outlining the rising role of cybersecurity in protecting their assets. Wells Fargo said it was increasing investment in “vital areas such as cybersecurity.”
JPMorgan went into even more detail on its efforts to fight off hackers. In his annual letter to shareholders,CEO Jamie Dimon said the bank would increase cybersecurity spending to more than $250 million annually with about 1,000 workers dedicated to those efforts.