What Causes Profitability?

August 12, 2014
/   Spotlight

Digital Insight proves that digital bankers actually drive increase engagement and profitability with their financial institution.

Cause and Effect: If you build it, will they come?

July 23, 2014
/   Spotlight

Many financial institutions assume that digital banking is lucrative because the most valuable customers happen to bank online. While there is certainly a correlation between online bankers and higher profitability, quantitative evidence suggests that...

Cause and Effect: If you build it, will they come?

/   Spotlight

Many financial institutions assume that digital banking is lucrative because the most valuable customers happen to bank online. While there is certainly a correlation between online bankers and higher profitability, quantitative evidence suggests that...

Intuit 2020 Report: The Future of Financial Services

April 11, 2011
/   Insights

Today, Intuit released the latest edition of the Intuit 2020 report, Intuit 2020 Report: The Future of Financial Services, which identifies and examines four key trend areas that will  transform the financial services industry...

Platform Shift in the Making

February 13, 2013
/   Insights

What does the banking industry as a whole have to do with Amazon, Microsoft and Apple? Just about nothing—and down the road, it may turn into a major problem (if it isn’t already). Consider...

Infographic: How to Spot a Fake Check

March 8, 2013
/   Insights

The team over at TROY pulled together an infographic on how to spot a fraudulent check. With more consumers using remote deposit capture to upload and deposit checks through their smartphones, it’s important to...

Fast Facts: Student Loans

January 22, 2013
/   Insights

The Financial Services Roundtable recently released another iteration of its Fast Facts, reliable, bullet-point research about issues facing the financial services industry. Topics span TARP, Dodd-Frank, insurance, lending, retirement savings and more.  Below are some updated Fast...

Reserve Banking: The New Radical Idea

June 5, 2014
/   Insights

Banking is by nature a very conservative industry. That’s why the current buzz over ‘reserve banking’ is so interesting. Even the term seems innocuous, but the scenario it proposes is nothing short of revolutionary....

Financial Literacy Month: How are you celebrating?

March 22, 2013
/   Insights

With April approaching, it’s almost time to kick off Financial Literacy Month! Strongly supported by the United States Congress and the Financial Literacy and Education Commission, Financial Literacy Month aims to promote the importance...

Ransomware: The very word is unpleasant, turning up the seamy underbelly to hardware and software. But it is a real thing, and it’s gotten immensely popular. And now, it’s crashing our party.

Of course, ransomware is still basically malware in that it restricts access to the system it infects. However, it goes further than rival strains by specifically demanding a ransom in order go away. Like other viruses its specific origins are dubious, but there’s no question that this bit of capitalist skullduggery initially gained traction in Russia. True to form, it didn’t stay there long—according to anti-virus vendor McAfee, it doubled in scope in one year to 250,000 unique samples in the first quarter of 2013.

Those with memories of Soviet-era paranoia and Cold War hysteria might remember that there were constant fears of Russian spies sabotaging the U.S. infrastructure. One supposed threat was that those sneaky Russkies would infiltrate the banking system and undermine it, bringing the economy to a screeching halt. Well, it’s a few decades later, and the latest ransomware may not be quite such a problem, but there’s a whiff of those old fears anyway.

So, meet Svpeng. Kaspersky Labs first shed a light on this nasty piece of work last year, when it was still in mother Russia. But in June, a particular breed arrived here in search of Android devices. More specifically, it takes direct aim at mobile banking apps running on those devices and uses them to shut down the phone or tablet. The ransomware then emerges to ask for money to unlock it.

All this is bad enough, but there’s another milestone of sorts here. By some accounts, this is the first major virus to systematically target mobile banking apps. And given that there are more than 100 million mobile banking users in the country, that’s potentially very bad news.

While these are early days and there will surely be other variants, here’s how the scenario currently plays out. Svpeng gets into the device through a coordinated social media campaign, then seeks out apps from a list of blue-chip vendors, such as American Express, Citigroup, Bank of America, Wells Fargo and JPMorgan Chase. And once it’s in there it’s almost impossible to scrub.

The ransomware takes the form of a fake FBI letter that asks for $200 in the form of to be paid through Green Dot MoneyPak cards. (It helpfully suggests outlets where those cards can be bought.) So far the malware doesn’t seem to be stealing bank credentials, but that’s what it did in Russia, so it will likely happen here soon enough.

That fact that malware has become so targeted and proficient is not a surprise, but it’s unfortunate nonetheless. The bigger worry may be that the financial services providers developing and distributing those for the public to use can’t really do much about it—they can perhaps exert some control over customers’ interactions with those apps, and that’s about it.

We’ve known all along that the unbelievable growth of mobile banking would give rise to a new generation of cyber criminals, and it’s happening now. There will be more such attacks not less, and we can’t put the genie back in the bottle, any more than we can take control of our customers’ phones.

There’s no magic bullet here. What we can do, over and over again, is urge our customers to practice greater caution in downloads and communication with strangers. Most consumers still fail to exercise basic security procedures, and a little goes a long way. Otherwise, we’ll all end up paying the ransom.

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Voices

Compelling voices and contributed content from around the web

Brad Strothkamp

http://www.forrester.com/rb/analyst/brad_strothkamp

James W. Gabberty

Gabberty is a professor of information systems at Pace University in New York City. An alumnus of the Massachusetts Institute of Technology and New York University Polytechnic Institute, he has served as an expert witness in telecommunication and information security at the federal and state levels and holds numerous certifications from SANS & ISACA.

Marisa Mann

Marisa Mann brings over 15 years of experience in consulting and financial services industries to the Solstice team, working on large scale enterprise initiatives across many technologies, including specializing in the digital space – Internet and mobile. Mann is passionate about mobile and the endless possibilities for the enterprise, delivering business value through strong brand recognition and driving to excellence in the consumer experience. Prior to Solstice, Mann worked at JP Morgan Chase, Diamond Management and Technology Consultants, Washington Mutual, Inc, and Accenture.

Zachary Ehrlich

25-year-old writer, and as a native San Franciscan, I am unreasonably loyal to Bank of America, if only for their superhero-like origin story, involving the 1906 earthquake and Italian fruit vendors.