How the Financial Industry Optimises Security Defence Systems Through Security Validation

Financial institutions are 300 times more likely to be targeted by cyberattacks than other companies.

Boston Consulting Group

Most critical functions of 21st-century society are inevitably dependent on digital infrastructure, especially the financial industry. The more the financial system relies on digital technology, the more interconnected it becomes, and the more vulnerable it is to cyber exploitation. Today's consumers place a higher value on convenience, and financial institutions encourage consumers to use online transactions to improve efficiency and reduce operating costs. The intensive interconnectivity of the financial industry, the extensive digital footprint of consumers, and the high dependence on technical infrastructure present an extremely large attack surface.

For instance, cyber attackers might steal credentials and obtain information such as passwords and personal information of bank employees and customers to access accounts and issue fraudulent payment instructions. Phishing is a low-risk, low-cost, low-barrier tool that is extremely easy to operate, even for attackers with the lowest skills.

The global scale, complex interconnectivity, and systemic importance of the financial industry pose unique cybersecurity challenges, meaning that a single compromised node could have disproportionate consequences on the security of the entire network. The WannaCry ransomware spread to hundreds of thousands of computers within days.

Furthermore, we must realize that geopolitically motivated cyberattacks have become a serious

threat that the current financial industry may face. The business model of the financial industry relies on consumer confidence in the entire financial system. Therefore, cyberattacks suffered by the financial industry may not be out of direct economic motivation. Distributed Denial of Service (DDoS) attacks can disable financial services, preventing customers from accessing accounts and processing payments. The large amount of sensitive customer data held by financial institutions contains a vast amount of high-value personal information. Large-scale data breaches can severely damage the user confidence upon which the financial system relies.

Financial institutions must take more measures to stay ahead of the rapidly changing risk landscape and maximize the effectiveness of their security defenses. Simply deploying security products is not enough to ensure their effectiveness and accuracy, nor can it guarantee their ability to defend against the latest threats over time. Given the continuous emergence of new attacks, infrastructure weaknesses, and other inevitable changes, continuous validation and adjustment of security defenses are crucial.

In recent years, the "Data Security Law" and the "Cybersecurity Law" have successively put forward programmatic guidelines for security effectiveness validation, requiring relevant institutions to perform regular drills and possess the capability to maintain a continuous state of security. The "Security Protection Requirements for Critical Information Infrastructure of Information Security Technology" released in 2022 explicitly requires the implementation of continuous offensive and defensive drills. The financial sector in China has also begun to explore industry standards for security effectiveness validation.

The China Securities Regulatory Commission (CSRC) released the latest "Measures for the Administration of Cyber and Information Security in the Securities and Futures Industry" last month, requiring institutions to establish a cyber and information security protection system, and still emphasizing the importance of regular offensive and defensive drills. It also further implemented the national security protection requirements for critical information infrastructure, clarifying that the CSRC and its dispatched offices can commission professional organizations to carry out supervision and inspections of industry institutions.

The Ministry of Public Security's Third Research Institute's Key Laboratory of Information Network Security of the Ministry of Public Security also recently launched a cybersecurity practical capability maturity model and a brand new evaluation system, proposing to view technical validation as a fire drill for the organization's own information system, comprehensively testing the organization's response and protection capabilities when facing real cyberattacks, and using the information collected during the simulation process to improve the organization's cybersecurity strategy and confirm the effectiveness of security products.

As a pioneer of the concept of security validation in China, Security Validation simulates real-world APT attack scenarios to validate whether the security tools deployed by the enterprise itself are playing an effective role. Through continuous validation, it helps you maximize the return on investment of your existing security investments. The Security Metrics Validation Platform can also provide data support and security operation and maintenance recommendations for financial institutions to help respond to the assessment requirements of laws, regulations, and industry regulators.

Security Validation has served multiple industry leaders in the financial sector, accumulating mature security validation practice experience. Financial enterprises often involve multiple security zones or multiple data centers and face various environmental changes. The Security Metrics Platform helps financial enterprises discover weaknesses in their security defense systems, continuously monitor drift in security defense capabilities, and improve the accuracy of various incident response and compliance processes by realistically simulating various attack methods in production environments.

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