Most insurers, banks saw cybercrimes grow during past year
While the rate of cybercrimes was growing, budgets for IT, fraud and risk departments were cut by more than a quarter.
Since the onset of the pandemic, nearly three-quarters of insurers and banks have experienced an uptick in cybercrime, according to a survey by BAE Systems.
When it comes to the reason for the surge, 42% of respondents said remote-work models put in place during the pandemic have made for a less secure situation. Additionally, 44% said work-from-home arrangements make it hard to detect holes in network security.
Further, during the past 12 months, budgets for IT security, cybercrime, fraud and risk departments were cut by 26%, BAE systems reported. On top of this, 36% said they had to lay off members of their IT security teams.
This is leading 37% of financial institutions to believe their customers are now at a greater risk of cybercrime or fraud.
Adrian Nish, head of cyber at BAE Systems applied intelligence, said in a release: “We’re noticing a clear collaboration emerging between different groups of criminals across the wider landscape of serious and organized crime. Fraudsters and cybercriminals seek to exploit fear, uncertainty and change, and the pandemic has offered them new opportunities to probe for weaknesses they can monetize and new ways to disguise their activity.”
Losses mount
Along with an upswing in cybercrimes, more than half of insurers and banks in the U.S. and U.K. saw an increase in financial losses during the past 12 months, with BAE Systems reporting the average cost reached $720,000.
In addition to financial institutions, their customers are also being targeted more frequently by cybercriminals. Nearly 30% of consumers said they received a hoax email related to COVID, while 22% were targeted by text with similarly suspicious communications. The average amount stolen from consumers by cybercriminals amounted to $1,174, even after being refunded, according to BAE Systems.
A spike in online shopping also opened avenues for hackers, with around a quarter of consumers saying they bought something from a fraudulent site in the past 12 months that they never received.
Unsurprisingly, identity theft is a leading concern among consumers.
When it comes to whose job it is to protect customers, 53% of consumers said it was the financial institutions’ duty, and 40% said it was their own responsibility.
“Attackers are building increasingly advanced capabilities to target core banking systems and becoming more aggressive, harming victims’ ability to respond to attacks. Online criminals have reacted fast, adapting their approach to hunt out remote working security gaps and prey on the vulnerable,” Nish said.
Related: