October is National Cyber Security Awareness Month
Every credit union is unique. They cater to different audiences and are passionate about different causes. However, there are some things that every credit union has in common. They always put their members first. Second, they are beginning to focus more on cybersecurity now than ever before. This is important because the more secure a credit union is, the better position it's in to protect its members' information.
With October being National Cyber Security Awareness Month, now is the perfect time for credit unions to work hard and make the changes they need to ensure their systems are capable of staying strong against fraud.
Credit unions battle fraud
Fraud is a growing concern in the financial industry. Technological advancements have made paying for items, transferring funds and making other financial decisions as easy as sending a text. However, even though these make money matters more convenient, they also give hackers and fraudsters a new mean to target individuals, businesses and financial institutions.
According to a 2015 survey from the National Association of Federal Credit Unions, credit unions spent an average of $226,000 specifically on debit and credit card fraud issues in 2014. Additionally, merchant breaches cost the credit union industry more than $31 billion in that same year. The majority of that cost went to reissuing affected cards, followed by investigations and losses, then monitoring costs. Clearly, cybersecurity is a top-of-mind concern for not just credit unions but all businesses and financial institutions.
While billions of dollars were lost due to fraud at merchant locations, credit unions are often the target of hackers as well. Credit Union Times detailed one type of malware that hackers have used to cheat credit unions out of their members' money. During the incident, the program silently opened up false accountsat the credit union, then wired money from existing ones to them. The hackers were also able to get their hands on credit card information. Over the course of the scheme, 30,000 members were impacted and the entire breach cost the credit union $350,000.
How credit unions can strengthen cybersecurity
Situations like merchant and credit union breaches occur far too often and usually put more than just financial information in jeopardy. Members who have been burned by poor cybersecurity measures lose faith in the institution at fault and will be more likely to take their business elsewhere. There are several measures you can take to bolster your credit union's security and improve your relationship with your member base.
First, you will need to assess your current risk. While it's important to begin improving your cybersecurity as soon as possible, blindly making changes without knowing what is currently working and what isn't likely won't be in your best interest. The Montana Credit Union Network explained that the risk assessment should look into potential internal and external threats and the likelihood that they would occur, as well as worst-case scenario results. Then, determine what security measures you already have in place and whether they are effective.
Education is key in making sure everyone working at or working with a credit union is on the same page. Technology is rapidly changing, which means that continual informational efforts are essential to ensuring everyone is up to date on the latest trends, technologies and tactics. The Filene Research Institute pointed out that when staff is properly informed and equipped with the right tools, the chance of an attack is much lower. Additionally, as Filene pointed out, 71 percent of cyberattacks are carried out through phishing. If people are able to immediately identify a fraudulent email or link, they are far less likely to let malware into their computer systems.
As technology changes, hackers will continue to become more sophisticated. They will stay on top of the latest developments and will always be working to figure out how to use them for their own personal gain. It's crucial that credit unions stay one step ahead of these thieves.
Unfortunately, though, fraudsters and hackers will continue to be a threat to credit unions, merchants and other institutions. While it's important to try to prevent breaches, it's also a good idea to be prepared in the event that one does occur. The Montana Credit Union Network implored credit unions to invest in insurance to help them manage the issue and resolve it quickly.
Cybersecurity is a growing concern for credit unions and other institutions and businesses everywhere, and for a good reason. Credit unions that are unsure of how effective their defenses are against an attack would likely benefit from assessing their risk and taking steps to ensure their online security is top-notch.