From Breach to Battle: Strengthening Your Digital Front Door and Cybersecurity

Back in the early 2000s, I faced a devastating situation when the digital banking company I worked for experienced a massive data breach – impacting hundreds of financial institutions.  

At the time, digital banking was new, and many financial institution executives thought the internet was just a passing trend, resulting in caution and fear that digital banking may put their accountholders and financial institution at risk. 

Fast forward to today, and the internet is still very much around – touching nearly every aspect our lives. Unfortunately, with advancements in digital technology and the internet come evolving fraud schemes and attacks – both of which have become more sophisticated and widespread than ever before.

In the early days of digital banking, end-user adoption was very low. But now, with the growing adoption of digital banking and fintech solutions, it’s more important than ever to be aware of these ongoing threats and to safeguard your applications and end-user engagement activities to stay secure.  

In fact, many banks and credit unions are seeing more than 85% end-user adoption. 

With digital banking adoption continuing to rise, it’s clear digital banking – whether online or mobile – is the new front door to financial institutions.

Safeguarding Your Financial Institution

The first step: recognize and understand the threats. Next? Implement security tools and best practices to protect against them at your front door and inside.

Fraud schemes in digital banking can come in many forms, including but not limited to:

1. Phishing Attacks – Fraudsters convince end-users they’re from their financial institution and trick users into providing sensitive information (e.g., passwords, 2FA codes, SSNs, etc.)
2. Account Takeover (ATO) – Fraudsters gain access to an end-user’s digital banking environment. Once inside, they can transfer money out of the account or obtain data to make purchases.
3. Identity Theft – Fraudsters use stolen personal information to open accounts or carry out other types of financial crimes.
4. Ransomware/Malware – Malicious software designed to intercept personal data or lock users out of their accounts.
5. Credential Stuffing – A cyberattack in which an attacker collects stolen credentials (e.g., usernames, passwords, email addresses, etc.) to access user accounts through large-scale automated login requests against a web application.

To protect against these attacks, you must implement a layered approach to security within your digital platforms and provide continuous education to your end-users on security best practices.  

Below are six of the most effective tools you can implement to protect you and your end-users against these attacks:

1. 2-Factor Authentication (2FA) – A security method requiring two different forms of identification, including something you have (such as a device, token, app, etc.), something you know (PIN), or something you are (biometrics) at system login and/or when high-risk activities are performed.
2. Real-time transaction monitoring – A fraud solution that monitors activity and can block or trigger additional authentication requirements in real-time if the activity appears suspicious.
3. Behavioral Analytics and Artificial Intelligence (AI) – Utilize AI and Machine Learning (ML) tools to monitor end-user activity and identify unusual behaviors to help prevent potentially fraudulent activity in real-time.
4. New Device Authentication and High-Risk Activity Blocking – This process prevents the addition of a new device (e.g., phone, computer, etc.) to an existing account for performing high-risk actions such as money transfers or changes to security/profile settings, until the new device is verified y the end-user or approved by the financial institution.
5. Anchor Device – An already registered device located near the new device to authenticate a new device and safeguard against device-based and ATO fraud.
6. End-User Education – Continuous education plays a vital role in preventing fraud. Keeping your end-users informed of common scams and how to identify them can go a long way in protecting your accountholders and your financial institution from devastating cyberattacks.

As digital banking becomes the primary gateway to financial services, it’s important to think of digital banking as the new front door to your financial institution. 

Just as we take steps to protect the new front door to the financial institution that more and more people will continue to use, it’s helpful to think about how we protect our own personal homes from threats, both inside and out.  We implement security tools and best practices to protect our families, but for community financial institutions, these end-users are your families that rely heavily on you for their financial protection.  This internet thing isn’t a fad.  It’s here to stay, and I assure you the fraudsters aren’t going away either, and they’re only getting more and more sophisticated.