Cyber security is constantly in the news. It poses a real risk to the safety of both our business systems and personal data.
It is also a major threat to our national security. In a recent speech given at GCHQ, the chancellor George Osborne, set out plans for a £1.9bn cyber investment to protect the UK from cyber attack and to ensure that the country can defend itself in cyberspace.
We should be concerned - a recent report from the Cabinet Office estimated that the cost of cyber crime to the UK economy could be as high as £27bn. A cyber attack on a major financial institution which paralysed systems could cause misery to millions of personal customers and enormous numbers of businesses.
Ashley Madison and Talk Talk serve as examples of the public fallout when data security is breached. In the immediate aftermath of the attack, Talk Talk was unable to tell customers how much data had been stolen. Experts voiced concerns about the company’s failure to tighten security after earlier attacks and their admission that sensitive data had not been encrypted. Talk Talk’s share price plunged 11 per cent as a result.
All financial advisers, whatever the size their business, should be asking themselves how secure is the data that they hold on their clients. A data breach can destroy hard-earned trust in that business overnight and has the potential to tar other advisers with the same brush.
A recent Tisa survey, run in conjunction with the website MoneyMagpie, asked readers for their views on the use of digital financial services. Although this cohort were surveyed online and have a keen interest in money it was perhaps surprising that over 80 per cent either had complete trust or some trust that their details were safe online.
The survey identified that 82 per cent of respondents manage some of their finances online. This trend is backed up by figures from YouGov which found that 77 per cent of bank customers use online or mobile banking at least once a month and the British Bankers’ Association who reported 7m daily log-ins to internet banking services.
A direction of travel towards ever increasing use of online services to manage our finances is established and, with many firms encouraging their clients to use online facilities to manage their financial affairs, businesses in financial services need to take the potential for cyber crime seriously.
This year Tisa established a Technology Innovation Policy Council to meet the needs expressed by our members for a greater understanding of the challenges and opportunities from the digital world. Dealing with cyber crime has been identified as a key focus for the council and we are working with organisations across the financial services and technology sectors with a view to creating standards.
The EU is also developing a digital single market strategy which will propose a fit-for-purpose regulatory environment for platforms and intermediaries aimed at reinforcing trust and digital services security in the handling of personal data.
