Wall Street may need to ramp up cyber security

High-profile attacks have been gaining steam, and The Hill's Brian Fitch wrote that there is an emerging need for more cyber security on Wall Street. With a little knowledge applied to nefarious goals, there can be a lot of damage done to industries that bring in a lot of money, with Fitch using the recent example of a $45 million systematic theft of ATM systems from across the world.

The federal government is looking for ways to keep funding to security products and services up and investors have taken note, with $1 billion given to cyber security startups in 2012 alone, according to numbers Fitch cited from the National Venture Capital Association. Robert Ackerman Jr., founder and managing director of Allegis Capital and a formal serial entrepreneur, said on PEHub that with these attacks growing more sophisticated and targeted, the increase in spending makes perfect sense.

"IT security has been a problem for years, threatening core economic drivers such as intellectual property, commerce, banking and the Internet," he wrote. "But it has become far more serious as foreign government spy organizations and organized crime have escalated their attacks and replaced young hackers as the chief perpetrators. Aggravating matters has been the explosion of billions of vulnerable, Internet-connected mobile devices worldwide."

Fitch wrote that there may need to be even more thought and money poured into cyber security and added that there should be a focus above and beyond typical cybersecurity offerings and moving into what companies have done to protect themselves from cyberthreats. A renewed focus would make sense, as a large number of attacks that have happened have been due to not only a high volume of attacks, but cybercriminals realizing that if they target their efforts to the C-suite they may have more success. For smart investors, Fitch wrote on The Hill that there has to be questions asked about what these organizations are doing to protect themselves from cyberattacks, as the results could end up affecting their bottom line's in a big way.

Findings from the Ponemon Institute's 2012 Cost of Data Breach Study showed that the average cost of a breach in the United States was $188 per compromised record. This is taking all businesses into account, so the stakes are likely to be much higher when looking at an industry like finance. Organizations that are worth a lot of money also have a lot of intellectual property that can cost an immeasurable amount of money to retrieve upon loss, with some documents gone forever, according to Fitch. It's simple, he said; companies need to start asking more questions about what kind of cyber security is in place, as it is no longer simply an IT secure and is now something the organization at large needs to be worried about.

"It is simple math really – in the 21st century, if you are going to invest in a company, find out if its digital assets have been compromised," he wrote. "Those assets are at risk, and waiting for the SEC or other government agencies to force such disclosures will not suffice.  Investors and analysts have the power to demand answers. One would like to think they have a stake in knowing whether they are investing in a secret sauce if it isn't really a secret."

Ackerman said with strong, ongoing cyber security investments and industry activity, odds are good that companies will be able to keep pace and stay secure. Once more are aware of how dire the need for greater cyber security has become, he said it is likely Americans will start to realize that this type of protection is worth spending money on.

Security News from SimplySecurity.com by Trend Micro.

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