The financial industries of most countries worldwide use emerging innovative technologies to cut down operational costs, enhance customer services, and automate work. For example, organizations in the Canadian financial sector heavily depend on Fintech, the Internet of Things, quantum computing, the cloud, and artificial intelligence, among others, to enable electronic financial transactions and data transfer between payment systems, institutions, vendors, and clients.
However, while these interconnections promise increased efficiency and faster communications, they have become attractive targets in today’s highly sophisticated and rapidly evolving cyber threat landscape. For example, a cyberattack that compromises only one financial organization can potentially spread to external partners, which may ultimately disrupt critical international and national financial systems.
Unsurprisingly, motivations like financial gains from transaction values that amount to billions of dollars daily have seen the financial industry face frequent and complex cyberattacks. For instance, Canada’s population has embraced online banking transactions more and more, with 76% of Canadians preferring mobile devices and online banking for all transactions.
Threat Environment in Canada’s Financial Sector
Cybersecurity professionals speak with one voice as they all agree Canada’s financial industry has a highly dynamic and relentless threat landscape. Let’s look at a report made to Canada’s House of Commons. It stated that financial institutions like banks, trust companies, and credit unions face non-state and state cyber threat actors who continuously evolve techniques and tactics to identify and exploit vulnerabilities. In addition, chief Superintendent Mark Flynn, Royal Canadian Mounted Police’ Director-General, noted that “cybercriminals may attempt to directly compromise the financial institution’s computer infrastructure through attacks that grant unauthorized access to the core systems themselves.”
In addition, cyber threats have become more persistent and pervasive, requiring the Canadian financial sector to collaborate closely to stay ahead of new threats. One of the most common threats facing financial institutions is ransomware. In 2020, ransomware attacks cost Canadian organizations at least $4.9 billion. While more than 57% of ransomware victims paid the demanded ransoms, only 28% regained access and control over their data. A significant 7.9% of all the attacks targeted Canada’s financial sector.
Also, FS-ISAC, a global community focused on sharing intelligence solely on financial services, found in its Global Intelligence Report that accelerated digitization in the financial industry has increased threats. The report also notes that high-profile cyber threats targeting critical zero-day security flaws and third parties in the supply chain have increased tremendously. While forecasting the cyber threat landscape for 2022, FS-ISAC expects that the ability of ransomware attackers to adapt, the growth of exploitable zero-day vulnerabilities, and third-party risks will complicate a challenging cybersecurity threat landscape in Canada’s financial sector and beyond.
Common Threats Facing the Canadian Financial Sector
Two of Canada’s leading banks were victims of recent attacks where malevolent cyber actors compromised the financial information of at least 90,000 customers. Simplii Financial, one of the affected banks, advised its customers to be more vigilant and announced the implementation of additional online protection controls after attackers compromised the account and personal information of an estimated 40,000 customers. Similarly, the Bank of Montreal also suffered a data breach that compromised the personal and financial data of approximately 50,000 customers. Authorities investigating the incidents believed that the attacks originated outside Canada.
These and many other attacks have been reported by several financial organizations in Canada due to various threats plaguing the sector. Some of the most common cyber threats facing Canada’s financial industry include:
- Ransomware: Ransomware is one of the most common threats facing financial services in Canada. The attacks often begin with exploiting an unpatched vulnerability or a phishing email that enables attackers to access internal networks. In addition, hackers may lock sensitive files with powerful encryption or threaten to publish them on dark websites if the victims fail to pay up. For example, Naz Sukhram Financial Services, a small accounting firm in Canada, recently suffered a ransomware attack that compromised customer and personal data, causing it to stop business operations for several days as it dealt with the attack.
- Supply chain attacks: Many companies in financial services depend on a sophisticated and globally distributed supply chain to run critical operations. However, supply chain attacks enable cybercriminals to target networks and components of trusted vendors deep in the supply chain to compromise financial institutions. In addition, supply chain attacks are often hard to prevent since they may occur during hardware/software updates or service or product delivery. Cyber adversaries target the supply chain since they know multiple financial organizations will download and install compromised updates or upgrade their IT infrastructure using vulnerable components.
- State-sponsored attacks: Nation-state attacks from organized cybercrime groups with the support of foreign governments are a major risk to the financial industry. Nation-state attacks may involve several techniques, including Business Email Compromise, ransomware, and social engineering, and are often financially motivated. According to FS-ISAC, organized cybercrime groups and nation-states work together through shared funding, resources, and tools, which has seen a rise in attacks targeting the financial industry. Financial firms remain a prime target since they process large amounts of highly confidential information and financial transactions.
- Internet of Things: Financial companies are avid users of innovative IoT technologies in communicating with customers and enhancing business operations. However, each IoT device that connects to the network represents a potential entry point, which expands the attack surface significantly. The more endpoints connected to an organization’s network, the higher the risk of an attack.
How can you protect yourself?
Sentia offers cybersecurity solutions designed to protect your company from all types of cybersecurity threats. For example, our enterprise network security service helps manage the evolution of the modern enterprise network for on-premise, cloud, and hybrid environments. Also, as financial organizations’ networks grow in complexity, Sentia offers numerous managed security services, including IAM, network security, log/SIEM management, firewall management, etc., to ensure the security of your infrastructure. Coupled with Cynet’s extended detection and response (XDR) platform, Sentia’s cybersecurity services can secure your financial services from rapidly evolving cyber threats. Additional services include cybersecurity consulting, compliance consulting, Breach Readiness as a Service, and file integrity monitoring. Get in touch with our experts now.