New York – Driving home just how serious the growing threat of cyber attacks are on financial markets, the industry stress-tested its trading systems and crisis management responses with simulated malicious attacks in an exercise dubbed ‘Quantum Dawn 2′.
And the results of Friday’s test made public today by a Wall Street industry group showed a “resilient” market but one that must also remain vigilant against constant attacks. The simulation, which included “multiple” attacks aimed at causing systemic harm and enough disruption to the financial system to shut down the market, also identified areas in which the industry can do better.
“Cybersecurity is a top priority for the financial industry,” said Judd Gregg, a former U.S. Senator and current CEO of The Securities Industry and Financial Markets Association, or SIFMA.
“Quantum Dawn 2,” he says, “demonstrated the industry’s resiliency when faced with serious cyber attacks that aimed to steal money, crash systems and disrupt equity market trading. Complacency is not an option in the fight against cyber crime.”
The six-hour test included participation from more than 500 people and more than 50 entities, including Wall Street firms, stock exchanges, utilities, the U.S. Treasury, the Securities and Exchange Commission, the Department of Homeland Security and the FBI.
The goal was to identify cyber threats, combat them, and find ways to keep markets operating in an orderly fashion when an attack occurs. Denial of service attacks, or so-called DdoS-attacks, and phishing attacks are on the rise, SIFMA says. Increasingly, smaller financial institutions with less resources to combat cyber attacks are being targeted.
One area of improvement cited was the need for better communication between the private sector and the government, Gregg said. He called on Congress to pass legislation that promotes the sharing of information to mitigate the negative impacts of cyber attacks.
In addition, the financial industry should bolster its existing guidelines used to identify when an event is deemed “systemic.” Wall Street should also come up with industry-wide procedures to help determine the criterion for when markets should be shut down and reopened, the findings suggest.
A similar exercise to deal with cyber attacks occurred back in November 2011. That simulation was dubbed ‘Quantum Dawn.’
Successful cyber attacks could do great harm to investor confidence and cause major market disruptions, as well as cause asset prices to behave erratically.
“In today’s environment, it’s unrealistic to expect that defenses can prevent all cyber incidents,” says Ed Powers, national managing partner of Deloitte & Touche’s security and privacy practice. Deloitte served as in impartial observer of the exercise and helped put together the test findings.
- 22 Oct, 2013
- Posted by Tracy Campbell
- 0 Comments