The cyber beast

Sometimes I think that we could fill the pages of Emerging Risks with stories purely about the emerging cyber threat. After all, it’s not as if we’d be short of copy. Only this week, for example, we have run a gamut of cyber-related stories, including the attack on JD Sports; the smashing of a dangerous ransomware cartel by Interpol; the launch of a new cyber facility at Lloyd’s by WTW; and the attack on derivatives trading house Ion Group which affected both the trading and clearing of exchange-traded derivatives by ION customers across global markets..

Clearly, all attempted cyber-attacks are deeply concerning, especially if it is one that affects your business, but the targeting of Ion is especially concerning because it appears to have wider implications for the functioning of the derivatives market.

As we report, the seriousness of the attack is underscored by the fact that the Futures Industry Association, an industry group that represents futures dealers, investors and exchanges, said it was working with impacted members as well as market regulators to evaluate the extent of the impact on trading, processing and clearing.

It is understood that the attack affected 42 clients of Ion Trading UK, and forced a number of banks and brokers to process trades manually.

One likes to think that financial markets, especially in the City of London, have extremely robust risk management processes when it comes to mitigating the cyber threat, and I have little doubt that a huge amount of money and resource is devoted to ensuring that cyber security is as good as it possibly can be.

Yet still, sophisticated criminals, some of whom I also have no doubt are backed by Russia and other nation states, are managing to penetrate our defences.

We must do better.

Marcus Alcock

Editor, Emerging Risks