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According to participants in a round-table discussion at the SEC, Investment Advisers are experiencing an increasing number of cyber threats.
David Tittsworth, executive director of the Investment Adviser Association, said the primary risk that wealth managers in his group face is “account takeover”, in which a hacker poses as a client and tries to manipulate accounts. According to Daniel Sibears, Finra EVP, the Financial Regulatory Authority is in the middle of a cyber-security sweep of a cross-section of member firms. Initial results show that the top cyber risks that are identified include operational disruption, internal attacks by employees, external attacks by hackers, denial of service and phishing attempts. The SEC convened the forum to help its assessment of cyber security within the financial services industry. Cyber security continues to grow in importance, especially in light of massive customer data breaches at major retailers in the recent weeks. The forum participants cautioned regulators to not impose requirements and procedures that can be circumvented by clever hackers. For full access to this article, please click here.
What are your thoughts on cyber-security and its growing importance in the financial services industry? Do you believe that security regulations should be proactive or reactive?