As Ukraine fights for its freedom, US firms should watch for Russian hacks

Russia is waging a two-pronged war on the West and Western values. The first, in Ukraine, is a conventional war. More than 2,000 innocent civilians have been killed, according to estimates, and one million Ukrainians have fled to safety in neighboring countries. Our hearts go out to the besieged Ukrainians, and we stand in support of them in their fight for freedom and the sovereignty of their country.

Russia’s other war with the West is taking place in cyberspace. Its long-running efforts to spreading misinformation and foment strife are well documented, but as Western sanctions against Russia start to bite, there are fears its cyber aggression could escalate. Chief among the possible targets in the U.S. are the institutions that serve savers and investors.

As technology editor Sean Allocca recently reported, the Securities and Exchange Commission and the Financial Industry Regulatory Authority Inc. have published notices echoing the content of the Department of Homeland Security’s new webpage that specifically warns of cyberattacks emanating from Russia.

'HEIGHTENED POSTURE'

While it’s not detecting any imminent threats, the department’s Cybersecurity and Infrastructure Security Agency recommends that all organizations, regardless of size, “adopt a heightened posture when it comes to cybersecurity and protecting their most critical assets.”

To be sure, much of the work needed to provide critical security for investor accounts is done on an enterprise level by broker-dealers and custodians. And the nation’s financial institutions, aware of the potential for harm, for years have worked in conjunction with federal officials to put in place sophisticated cybersecurity systems designed to prevent damage from attacks on our financial infrastructure.

Advisers are the frontline force defending investors’ wealth from cyberattack.

But the increase in remote work as a result of the pandemic, conducted over networks that may not be secure, as well as the widespread use of mobile apps that are almost always connected to the internet, have added a new level of risk in recent years. Destructive attacks like those seen in Ukraine can enter a computer and randomly delete information or rewrite hard drives to effectively shut down the system, one cybersecurity expert told Allocca. The attacks have the potential to wipe out all of a client’s information and account documentation.

While advisers typically don’t store client financial data themselves, they play an important role in securing it. In fact, it’s not an overstatement to say that as the gateway to client data, advisers are the frontline force defending investors’ wealth from cyberattack.

To help in that role, the CISA recommends several actions, including ensuring that software is up to date, that tools are protected by antivirus/anti-malware software and that signatures in those tools are updated. Data backups should be performed frequently and kept isolated from network connections, and advisers should be able to contact a known cybersecurity expert or team in the event of a suspected emergency and have a secure way to reach them.

THE PRICE OF FREEDOM

If this vigilance is the price we must pay as Americans to protect our good fortune, we should consider ourselves blessed. Yes, fuel prices may rise and we may face other short-term difficulties, but we mustn’t forget how fortunate we are to be able to work, save, plan and see our children grow in freedom. Ukrainians share our dreams, and until a few weeks ago could hope to achieve them.

Now, their greatest dream is survival.