The world has changed in a myriad of ways as a result of the COVID-19 pandemic, from children kept out of school for months on end to previously busy restaurants and shops boarding up their doors and hoping for better times ahead. While this time has been difficult for millions, some people have profited – namely the Cyber Criminals who stalk the internet in search of easy victims.
Where are these remote workers coming from?
Increasingly victims are coming from the financial sector, and a lack of proper cybersecurity is often to blame. With brokerage offices shuttered and face-to-face interactions almost impossible, many financial advisors have been taking their operations online, creating more opportunities for cybercriminals and others bent on stealing money from the accounts of their clients.
This lack of Cyber Security has many root causes, ranging from a simple lack of knowledge to the failure to imagine the emerging threats. This is understandable – after all brokers are experts at stocks and bonds, not bits and bytes.
Even so, the lack of Cyber Security awareness has troubling implications, not only for large brokerage firms and their clients but for individual Financial Advisors and the men and women who rely on them for advice and guidance. So what can be done to address these Cyber Security deficiencies, and what can brokers, their clients, and others do to protect themselves, their money, and their financial futures? Here are a few timely tips for safeguarding your finances in the midst of the ongoing pandemic.
How can brokerage firms protect themselves from cyber crimes?
One piece of good news is the growing awareness within the Financial Industry itself. While many individual brokers and employees fail to grasp the true scope of the danger, the same is not true of the leadership. In fact, nearly eight in ten brokerage industry leaders said that Cyber Crime was their number one near-term threat, and that level of recognition could be good news going forward. From a recent Investment News article it was said that…
“Some firms are taking extra precautions, while others are not. Sixty-five percent of IBDs had at least some Cyber Security coverage in their E&O — Errors and Omissions — Insurance, and 29% purchased supplemental insurance for Cyber Liability, according to the study.”
After all, the shift to remote work when the pandemic first started was both swift and unexpected, and it is only natural that so many people were caught off guard. But now that the threat is being recognized, leaders in the Financial Industry are taking smart steps to address the issues, instituting mandatory training on the subject, tightening restrictions on the emailing and printing of documents, and even conducting security audits on the home networks of their employees.
Brokers and Financial Advisors can also do their part to educate their clients, not only on the importance of robust cybersecurity measures but also on how to have a Cyber Protection plan in place. The Game Stop fiasco and the SEC investigation into Robinhood offer further proof that many new investors are vastly underappreciating the risks inherent in the Stock Market, and that could spell bad news for the future of the financial industry.
The Importance of having a cyber policy in place
By combining client education, real-world Cyber Security training, and common-sense practices, Broker-Dealers, Financial Advisors, and others can do their part to fight back against the rash of cybercrime. If your firm doesn’t have a Cyber Protection plan in place, don’t wait any longer. With a quick application, we can get the ball rolling and have your protection in place, in no time! Your firm may not be able to stop the next data breach or react to every possible scenario, but rest assured once they have a cyber policy in place, by being more aware with ongoing education for themselves and their clients, keeping their eyes and ears open to what has become a more risky online environment. They will reduce their risk!