Pub. 11 2014 Issue 1

O V E R A C E N T U R Y : B U I L D I N G B E T T E R B A N K S - H E L P I N G N E W M E X I C O R E A L I Z E D R E A M S 16 ABA Insurance Services Is Your Bank Prepared for a Systems Breach or Other Cyber-Related Crime? First, there’s the eye-opening fact that any one individual or group is actually capable of infiltrating systems, not of smaller regional chains or mom and pop stores, but that of international retail giants; and doing so with what appears to be remarkable ease. Second, the ability of the criminals to effectively continue their operation under the radar for a relatively long span of time, allowing them to steal and proceed to sell of millions of identities on the black market. Third, these breaches are spawning secondary and separate crime sprees with the increase of spam and phishing emails under the guise of customer service emails fromTarget, Neiman Marcus or even a financial institution; thereby, taking advantage of the now more vulnerable consumer market. Given the enormity of all that has occurred (with probably more to come), you and your staff should be reviewing your bank’s insurance policies in addition to security processes and protocols in order to mitigate risk and losses, in order to protect not only your bank, but your customers as well. Consider the following: 1. Does your bank have up-to-date procedures in place for handling situations on a large scale? Have you and your staff reviewed them lately, given all the recent re- tail breaches? Typically, such criminal activity happens case-by-case and your bank staff can handle accordingly; however, given the scope of the recent retail breaches, is your bank prepared to handle mass account changes, be it proactively or by customer request? N o doubt, it has been surreal watching the twists and turns of the events as they unfold surrounding the recently announced system breaches of Target, Neiman Marcus, and other retailers purportedly to be named. With Target as a primary example, the systems breach of a major retai ler has proven to be a tr i fecta of cyber-related cr iminal act iv ity f rom the onset, af fect ing not only the retailer and their customers, but the financial services industry in general. NMBA Endorsed Company