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The importance of cybersecurity for UK financial advisors

Financial advisors are responsible for the data of their firm and their clients. Losing this data, allowing it to be stolen in a breach, often results in job losses and shutdowns.

That said, what threats do financial advisors have reason to fear?

Cyber risks facing financial advisors

Phishing scams

A common form of scams around the Internet, phishing scams trick victims into giving away personal information. This is done in several ways, including:

  • Exploiting the user’s lack of technical knowledge

  • Using fear/threats to coax information or payment out of the user

  • Promising a reward to the user

Phishing scams cause tens of millions of dollars in damages every year, and financial institutions are not invulnerable to them.

Insiders

However, not every cybercriminal relies on cyber-methods. Some use old-fashioned techniques to steal data, including having physical access to sensitive data through insider-breaching.

Insiders are cybercriminals that are in, or work closely to, the business being affected: past and present employees, third-party contractors, and suppliers. There are a variety of reasons an insider may appear, anywhere from an employee being bribed to give out data to a supplier that didn’t take proper care of their accounts.

Watering hole attacks

Financial advisors have a list of websites they visit regularly. So, what happens when a cybercriminal gets their hands on that list? Well, a lot of the time, a watering hole attack occurs.

A watering hole attack occurs when a hacker infects sites they believe their targets visit on a regular basis with malware. The plan with this type of attack is to infect at least one member of a business or institution with the malware, which will then allow the hacker to steal data, AKA cause a data breach.

3 Ways for Financial Advisors to Stay Secure

1. Use a VPN to encrypt your data

Many cybercriminals wait for someone to expose themselves on a network; rarely do they go out and seek a specific target out. To make sure you don’t put your and your client’s data at risk of being exposed, install a VPN.

Using a VPN to encrypt your network will make sure the data you send out and handle is undetectable to anyone else on the network.

2. Train employees on threat awareness

Ponemon Institute ran a study on the cost of data breaches and what causes them, and they found that employee error and weak passwords are two of the leading causes for data breaches.

The truth is, human error is responsible for many data breaches. Take some time to train your employees or clients on how to properly handle data and protect themselves while on the Internet. Doing this will significantly reduce the risk of user error, therefore reducing the chances of a data breach.

3. Securely backup data

Not only do financial advisors need to actively protect clients’ data, they need to prepare for the worst—in this specific context, data loss. Backing up data is necessary for secure data handling.

When backing up data, back up data three times using the 3-2-1 rule. Doing this will ensure your data not only stays out of criminals’ hands, but that it won’t be lost during an accident.

*Amy Cavendish is a content strategist at tech blog TechFools.

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