Throughout the financial industry, banks and financial institutions are putting fintech to work to create a streamlined, customer-focused experience. Although fintech is delivering on this promise, it is plagued by cyberattacks and bad actors looking to get their hands-on confidential information. Is fintech safe for its users? With attacks compromising passwords and customer funds, lawmakers are looking to regulate the technology in hopes to keep data safe.
Fintech not only brings new opportunities for the financial industry but national security vulnerability for the United States. If fintech is left unregulated, threats could quickly overtake the technology – turning from a strength into a vulnerability. Fintech offers mobile payments, easier access to financial tools, and better fraud detection, but it has its risks too.
Last year, a woman in New York was convicted of using Bitcoin as part of a money-laundering scheme to send over $150,000 to bad actors. This isn’t that uncommon. A Wall Street Journal investigation uncovered over $90 million in money laundering through cryptocurrency exchanges to North Korea-linked hackers responsible for the WannaCry cyberattack.
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For bank branches, enacting a digital strategy is more important than ever before. A recent report by Tiffani Montez of the Aite Group, encourages financial institutions to reimagine the bank branch and make it a vital part of customer engagement. To do this, many banks are looking to fintech to increase their value brought by digital interactions.
Quality data “can help [financial institutions] determine whether to retain, relocate, or consolidate existing branch locations through tools that allow banking executives to analyze customer data and site characteristics that impact branch network performance,” says Montez. Customer data is also used to ensure fintech isn’t being misused, ensuring a secure environment.
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With fintech, hacking to gain access to password, credentials, and other confidential information is of great concern to lawmakers. Cardinal RAT, a malware targeting fintech and cryptocurrency companies, remained undetected for two years before being discovered in 2017, but this discovery hasn’t slowed down the number of cyber attacks deployed by the malware.
The malware collects usernames, passwords, and screenshots of customer activity, enabling the hacker to easily access an account. Cardinal also self-updates to remain on the machine it has infested and can hide its tracks by clearing cookies and deleting information once the information has been stolen.
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