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Swift, the global financial transaction messaging processor used by nearly ever financial institution suffered a concerning breach of its security controls allowing banks in Bangladesh and Ecuador to steal several million dollars as this article in the Wall Street Journal reminds us:
Hackers have found some of Swift’s customers to be a weak spot, allowing them to send fraudulent messages over the network and in the process raising questions about controls.
This has attracted attention of U.S. banking regulators like never before:
The Federal Reserve, Office of the Comptroller of the Currency and Federal Deposit Insurance Corp have told their examiners to look more closely at the security of the banks’ links to the Swift network.
The moves show how regulators are starting to pay more attention to Swift, a co-operative that runs the international messaging system among banks, whose security was taken for granted for decades.
Although Swift is working closely in partnership with regulators, additional regulatory requirements could be a drag on some important new functionality that Swift is undertaking. This includes the adoption of new ISO standards and other changes to ensure it remains competitive in the long term as new faster payments platforms develop solutions that may represent a competitive threat.
Overview by Sarah Grotta, Director, Debit Advisory Service at Mercator Advisory Group
Read the full story here