How can Financial Services protect themselves from supply chain cyber attacks?


14th December 2023BlogTom Richards

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Protecting Financial Services with Supply Chain Cyber Security

In today’s digital landscape, the financial services industry has become an attractive target for cybercriminals. The rapid growth of the internet and e-commerce opened up new opportunities for hackers to exploit individuals and organisations. As a financial service business, it is crucial to understand the evolving threat landscape and take proactive measures to protect your sensitive data and systems. Here are some key points  Tom Richards covered in the recent FSQS Live presentation.

Supply Chain Cyber security presenation by Tom Richards at FSQS Live

Watch the presentation here

The evolution of financial cybercrime

The emergence of the internet and e-commerce brought about a significant shift in the motives of cybercriminals. Initially driven by curiosity and the desire for recognition, hackers began to recognise the financial potential of their activities. The first wave of financial cybercrime included activities such as credit card fraud, online scams, and identity theft. However, as more personal and financial information became digitised, data theft became a profitable endeavour for cybercriminals. Stolen data, including credit card information, social security numbers, and personal records, could be sold on the black market, marking a significant change in the financial motives of cybercriminals.

The rise of cryptocurrencies and ransomware

The rise of cryptocurrencies presented both new opportunities and challenges for cybercriminals. Cryptocurrencies offers a relatively anonymous and decentralised means of conducting financial transactions.  Consequently, they become attractive for money laundering, ransom payments, and conducting illegal transactions on dark web marketplaces. This led to the emergence of ransomware, which encrypts a victim’s data and demands a ransom payment in cryptocurrency in exchange for its release. Ransomware attacks allow cybercriminals to directly extort money from individuals, businesses, and even governments, capitalising on their dependence on critical data.

Cybercrime-as-a-Service: A lucrative business model

The evolution of cybercrime gave rise to the Cybercrime-as-a-Service model. This model enables non-technical individuals to participate in cybercrime by providing them with ready-made tools and services. Cybercrime-as-a-Service platforms offer hacking tools, malware, stolen data, and even access to botnets, making it easier for anyone to engage in cybercriminal activities. This has contributed to the exponential growth of the cybercrime industry, which is estimated to be worth $8 trillion, with ransomware alone accounting for $30 billion and Business Email Compromise (BEC) scams amounting to $26 billion.

The impact of AI on cybercrime

Artificial Intelligence (AI) has revolutionised various industries, and cybercrime is no exception. AI-powered cybercrime has become more sophisticated, profitable, and difficult to defend against. It has also made cybercrime more accessible to a wider range of criminals. AI-powered malware can generate new variants at an alarming rate, making it challenging for traditional antivirus software to detect. AI-powered bots can automate phishing attacks, targeting a large number of people with personalised approaches. Moreover, AI can analyse large datasets to identify potential victims of fraud or other crimes and develop social engineering techniques that are more likely to fool victims.

The importance of regulatory compliance

Strict regulations govern the finance and insurance industries to protect sensitive customer information and ensure the integrity of financial systems. Some of the key regulations include Sarbanes-Oxley, NIS2, DORA, FCA, PCI Security Standards Council, and the Bank of England Prudential Regulation Authority. Compliance with these regulations is essential to maintain the trust of your clients and avoid legal and financial repercussions. It is crucial to stay updated with the latest regulatory requirements and implement robust security measures to meet compliance standards.  However, whilst the cyber security requirements of finance and insurance firms are tightly controlled, many third-party suppliers to these organisations are not.

Finance and Insurance industries are governed by strickt regulations


The invisible threat: supply chain security

In recent years, supply chain security has established itself as a very credible invisible threat to businesses. Consequently, hackers have targeted key suppliers to gain unauthorized access to their customers’ networks. Examples of recent breaches include a badge manufacturer for the Metropolitan Police, leading to the loss of over 40,000 police officers’ details, and a security fence provider for the Ministry of Defence, losing classified plans for several MoD sites. Moreover, thousands of companies have been affected by supply chain cyber security vulnerabilities, such as in the case of Progress MOVEit and Swan Retail. To better manage suppliers and mitigate supply chain risks, traditional questionnaires – sent annually, taken on trust and immediately out of date – are no longer sufficient. Proactive monitoring of suppliers and continuous assessment of their security posture is essential.”

supply chain security - the invisible threat

Understanding the Hacker’s Perspective

To effectively protect your financial service business from cyber attacks, it is essential to understand what hackers look for. In general, hackers seek the path of least resistance and maximum return for their effort. They exploit vulnerabilities such as outdated patch levels, open ports, misconfigured servers, and poorly implemented security certificates. Many companies unknowingly expose critical information to the internet, making it easier for hackers to infiltrate their systems. Given the choice between attempting to breach the highly advanced security measures of a financial institution or attacking via a less secured third party, it is often the latter that gets targeted.

In addition, hacking into a third party, as in the case of MOVEit, may provide sensitive details of thousands of end users.  The hacker then has the option to attempt to extort the third party or each individual affected company for a ransom payment. As a result, it is crucial to regularly assess and enhance both your internal & third-party cyber security posture to minimise vulnerabilities and deter potential attackers.

Supply Chain Cyber Security as a Service

To address the challenges of supply chain security, businesses can leverage Supply Chain Security as a Service from Northdoor. This service provides an independent hacker’s viewpoint of your key suppliers – open ports, compromised passwords, known unpatched vulnerabilities – with daily updates on any significant risk profile changes. It also offers a monthly review of reports with your security team and a recommended action plan for discussion with suppliers. By automating supplier risk assessment in real-time, you can identify and mitigate potential vulnerabilities effectively. Only 11% of companies proactively monitor their suppliers, highlighting the need for a proactive approach to supply chain cyber security.

Shifting from a tools mindset to Security Operations

Effectively protecting your financial service business from cyber-attacks requires a shift from a tools-based mindset to security operations. While tools and technology play a crucial role, an operational approach that blends technology with people and processes is essential. Optimising existing IT and security controls and leveraging cloud platforms for storage, enrichment, and analysis of security-related data can enhance your security posture. Focusing on desired outcomes and implementing a comprehensive security strategy that spans identification, protection, detection, response, and recovery is crucial. Building resilience and maintaining a 24×7 security posture are key to sustaining improvements in your cyber risk.


Protecting your financial service business from cyber-attacks is a complex and ongoing challenge. By understanding the evolving threat landscape, staying compliant with regulations, and adopting proactive security measures, you can minimise the risk of cyber breaches. Moreover, becoming aware of third-party supply chain risk and actively preventing security breaches via this route is going to be a key trend that we expect to see in 2024 as more companies implement more robust procedures in response to FCA Operational Resilience and DORA regulations that have a strong third party risk focus. Embracing an operational mindset that combines technology, people, and processes will enable you to effectively defend against emerging threats. With the rise of AI-powered cybercrime and the invisible threat of supply chain cyber security, it is crucial to stay vigilant and continuously adapt your security strategies. By prioritising cyber security, you can safeguard your business, protect sensitive data, and maintain the trust of your clients.

Free “Hacker’s View Assessment” offer

Are you concerned about your company’s exposure to supply chain cyber risks?

Unlock key insights into your Supply Chain Cyber Risk.

We’re offering a FREE Hacker’s View assessment of both your domain and two of your key suppliers. You will be able to view weaknesses, exploits and more that will expose potential areas of concern that you will be able to discuss with your suppliers to ensure that you minimise your cyber risk.

The service is entirely non-intrusive; no effort is required by either your company or your selected suppliers, and the online report is available to view without any commitment from you.

Don’t let cyber risks compromise your business. Take advantage of our offer and gain valuable insights into your supply chain security.

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