A cyberattack against a single major financial institution could disrupt the entire global monetary system, the International Monetary Firm warned.
A new IMF analysis found that many domestic financial systems are “unprepared” to handle a major cyberattack and that international coordination between banks is “weak.”
Authors Jennifer Elliot and Nigel Jenkinson theorized that a successful attack would have a cascade of negative implications, including home buyers losing homes and investors demanding their money back.
“Given strong financial and technological interconnections, a successful attack on a major financial institution, or a central system or service used by many, could quickly spread throughout the financial system and cause widespread disruption and loss of trust,” the authors wrote. .
“Transactions could fail as liquidity is trapped, households and businesses could lose access to deposits and payments.
“In extreme scenarios, investors and depositors may demand their funds or try to cancel their accounts or other services and products that they regularly use.”
A move away from traditional bank branches and mobile banking applications has also exposed a weak spot for many financial institutions, which are now vulnerable to millions of “hacking” opportunities.
“Hacking tools are now cheaper, simpler, and more powerful, allowing less skilled hackers to do more damage at a fraction of the previous cost,” Elliot and Jenkinson write.
“The expansion of services based on mobile devices (the only technology platform available to many people) increases the opportunities for hackers.
“The attackers target institutions large and small, countries rich and poor, and operate without borders.”
To combat widespread cyberattacks, the authors point to new research suggesting six main strategies, including sharing information across national borders and enforcing criminal offenses for cyber attackers.
In 2019 alone, Australians lost more than $ 634 million to scams in just 12 months.
The cost of cybercrime to the Australian economy is estimated to be as high as $ 29 billion each year.
The Australian Center for Cyber Security noted that over a 12-month period it logged nearly 60,000 reports of cybercrime at an average of 164 per day or roughly one report every 10 minutes.