Over the past few months, an international group of cyber bank robbers, possibly funded by the North Korean government, have stolen nearly $100 million, thrown the integrity of a decades-old banking industry messaging system into question, and remain at large. Sound like the plot of the latest James Bond summer blockbuster? Unfortunately, these hacks, utilizing the SWIFT network messaging system, are all too real – and they’re probably far from over.

The SWIFT network: What is it, and what happened?

SWIFT, the Society for Worldwide Interbank Financial Telecommunications, is a secure messaging network used by financial institutions to transmit information and instructions to each other. In particular, it allows banks in different countries to easily communicate using a standardized system of codes. It was created in the early 1970s as an alternative to Telex messages, which were slower, less secure, and more prone to human error. The SWIFT network does not actually move or store money; it is simply the conduit that banks use to initiate money transfers.

The attacks began in February, when hackers used the Central Bank of Bangladesh’s SWIFT network login credentials to request nearly $1 billion in money transfers from the bank’s account at the New York Fed to accounts in Sri Lanka and the Philippines. The majority of the requests did not go through, having been flagged for review by U.S. officials, but five requests, for a total of $81 million, were sent. Following the Bangladeshi heist, a number of other banks, mostly in Southeast Asia, reported having been victimized by similar attacks that may have involved the SWIFT network. The hackers struck again in June, this time stealing $10 million from a bank in Ukraine.

Ukrainian officials allege that numerous other financial institutions in Ukraine and Russia have been hacked but do not wish to publicly identify themselves. So far, all of the targeted banks have been outside of the U.S., most of them located in developing countries with reporting requirements that are lax compared to U.S. standards. This means that no one has a handle on the true extent of the SWIFT network attacks, which makes banking executives all the more nervous.

As the SWIFT organization has maintained from the beginning, the SWIFT network itself was not actually breached; hackers were not able to break into the system or intercept legitimate messages. Instead, they accessed the network through the targeted banks’ systems, installing malware so they could access the banks’ SWIFT terminals and send the money transfer requests. However, because SWIFT was involved, it finds itself under fire. SWIFT’s CEO has gone on the defensive, insisting that the SWIFT network is secure, blaming the hacks on lax security procedures at member banks, and threatening to pull their access to the SWIFT network if they do not implement stronger cyber security practices.

However, at the same time, SWIFT has announced it would tighten its own security procedures, and experts in the industry are criticizing SWIFT for not being proactive about its cyber security, instead waiting for a breach to occur to address vulnerabilities that have long been an open secret in the banking industry. While SWIFT has a monopoly on its niche market in the short-term, if more banks are hacked, and especially if Western banks are victimized, the long-term future of the SWIFT network will be in question.

What All Organizations Can Learn from the SWIFT Network Attacks

The SWIFT attacks have rocked the banking world, but organizations in all industries can learn from the mistakes made by SWIFT and its member banks, specifically:

• An organization’s people are the weak link in any cyber security plan. The SWIFT network hackers got into the banks’ SWIFT terminals through keystroke-logging malware, possibly installed through a human hacking technique such as spear-phishing. As we have mentioned on this blog many times, enterprise cyber security begins with organizations having robust cyber security plans, including continuous employee training on cyber security awareness and best practices.
• “Security through obscurity” does not work in the Internet Age. Before the internet, proprietary niche networks such as SWIFT – which few people outside the banking industry have ever heard of – enjoyed what is known as “security through obscurity.” These networks were largely unknown outside their niche markets, and little public information was available about them. The internet changed all of that; information about these obscure networks is now widely available. Hackers, knowing that many niche networks built pre-internet have multiple security vulnerabilities, are seeking these networks out as easy targets.
• Appropriate security controls are needed for both users and transactions. After the Bangladeshi heist broke, JPMorgan Chase and Bank of England announced they were going to limit the number of employees with access to SWIFT terminals. Giving employees access only to those systems they need to perform their jobs is a sound practice, and access levels should be reviewed periodically. Different types of transactions also require different security levels. A user name and password may be sufficient for a billing employee to send an invoice or a customer to log in to their account, but sensitive transactions such as large money transfers should require multi-factor authentication and multiple levels of confirmation.

The cyber security experts at Continuum GRC have deep knowledge of the cyber security field, are continually monitoring the latest information security threats, and are committed to protecting your organization from internal threats and external security breaches.

Continuum GRC offers full-service and in-house risk assessment and risk management subscriptions, and we help companies all around the world sustain proactive cyber security programs. Continuum GRC is proactive cyber security®. Call 1-888-896-6207 to discuss your organization’s cyber security needs and find out how we can help your organization.

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Insider Threats: The Enemy Within

The Hollywood portrayal of a hacker is a mysterious hooded figure sitting in a dark room, furiously tapping away at a keyboard in search of a back door into an organization’s system. However, the real enemy may be sitting in a brightly lit cubicle right outside the CEO’s office. Insider threats pose just as much danger to organizations as outside hackers. According to a research study by Intel, 43% of data losses happen due to the actions of “internal actors.” About half are unintentional accidents or carelessness, while the other half comprise purposeful malicious activity.

Security researcher Brian Krebs reports that some organizations are paying security firms or partnering with law enforcement to monitor the Darknet, a hidden online underworld that can only be accessed using special software that hides users’ identities and locations, in an attempt to stop disgruntled employees from selling privileged company information such as high-level system credentials. However, by the time an inside actor is snagged trying to strike a deal on the Darknet, the damage has already been done. Additionally, this monitoring does nothing to address the insider threats from carelessness, negligence, or a simple lack of cyber security awareness.

Continuum GRC recommends that organizations take the following proactive measures to protect themselves against insider threats:

Have a written acceptable use policy.

A written acceptable use policy is a very basic step that many organizations overlook. It is imperative that specific rules are established regarding the acceptable use of company hardware, software, and network access. The policy should be in writing and signed by every employee. While a written policy won’t stop insider threats due to malicious acts, it will provide leverage for a company to take disciplinary action against an employee who violates the policy.

Establish user behavior baselines and monitor your network for deviations.

The “human factor” in preventing insider threats only goes so far. Technical defenses are also necessary, including 24/7 monitoring of your organization’s system. Baseline patterns should be established for each user, and any changes in user behavior, such as a user logging into the system from an unusual location or attempting to access a part of the system they don’t need to do their job, should be flagged and investigated.

Restrict system access as appropriate.

No employee should have a higher level of access to the organization’s system than they need to do their job. A salesperson has no need to access employee tax and salary data. Employees in the human resources department wouldn’t normally need to access the billing system. Limiting system access not only protects against malicious insiders but also prevents hackers from obtaining the “keys to the kingdom” should they manage to steal credentials from a lower-access employee.

The cyber security experts at Continuum GRC have deep knowledge of the cyber security field, are continually monitoring the latest information security threats, and are committed to protecting your organization from internal threats and external security breaches. Continuum GRC offers full-service and in-house risk assessment and risk management subscriptions, and we help companies all around the world sustain proactive cyber security programs.

Continuum GRC is proactive cyber security®. Call 1-888-896-6207 to discuss your organization’s cyber security needs and find out how we can help your organization protect against insider threats.

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Wendy’s Data Breach: Forget the beef, where’s the data security?

The Wendy’s data security breach, news of which first broke in January, is much worse than the fast-food company originally thought. Wendy’s first reported that the POS system breach impacted only about 5% — or approximately 300 – of its franchise-owned restaurants. However, after allegations by security investigator Brian Krebs that “a number of sources in the fraud and banking community” had told him that “there was no way the Wendy’s breach only affected five percent of stores — given the volume of fraud that the banks have traced back to Wendy’s customers,” Wendy’s finally admitted that its original figures were incorrect, and the number of locations compromised in the Wendy’s data breach is anticipated to be “considerably higher.”

In its statement to Brian Krebs, Wendy’s takes great pains to point out that the data breach impacted only franchised locations, not company-owned restaurants, and involved hackers stealing legitimate login credentials from third-party vendors who service the POS systems at those locations. However, that hasn’t stopped First Choice Federal Credit Union from filing a class-action lawsuit against the Wendy’s corporation, alleging inadequate information security practices and demanding that the chain improve data security at all 6,000 of its locations, both franchised and company-owned.

Human Hacking May Be Behind Wendy’s Data Breach

Wendy’s alleges that its POS systems were breached after hackers stole legitimate login credentials from third-party service providers, which allowed the hackers to remotely access the POS systems. The majority of data breaches, including the notorious Anthem breach, can be traced back to stolen login credentials. Usually, these credentials are acquired using human hacking (aka social engineering) techniques such as phishing emails. This illustrates the importance of companies ensuring that all third-party vendors adhere to cyber security best practices, including training their employees to spot phishing emails and other social engineering techniques.

Restaurants and retailers do not have to stand by helplessly while their POS systems are compromised; there are numerous proactive measures that can be taken to secure POS systems. These include monitoring the system for suspicious activity, including login credentials being used in an unusual manner or the POS system communicating with unknown external sources. If Wendy’s had taken its cyber and data security seriously, this data breach could have been prevented. However, the company chose to place the responsibility for POS system security on the backs of its franchisees, then, when a breach occurred, point fingers at those franchisees and their service providers.

The restaurant industry, which is planning to switch from human order clerks to automated touch screens and kiosks, cannot afford to repeat the mistakes made by the healthcare industry when it transitioned to electronic records. It is imperative that the industry realize that customer data security is just as important as food contamination prevention and take proactive steps to protect its POS systems.

The cyber security experts at Continuum GRC have deep knowledge of the cyber security field, are continually monitoring the latest information security threats, and are committed to protecting your POS system from security breaches. Continuum GRC offers full-service and in-house risk assessment and risk management subscriptions, and we help companies all around the world sustain proactive cyber security programs.

Continuum GRC is proactive cyber security®. Call 1-888-896-6207 to discuss your organization’s cyber security needs and find out how we can help your restaurant protect its POS data and ensure compliance with PCI DSS.

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