By: Tigran Safari, Client Experience Manager, Secured Managed Services
Credit Unions and Cyber Security Practices
How vulnerable are credit unions, the bedrock of community finance, to rapidly advancing cyber threats?
CISO Global understands that credit unions’ member-owned and not-for-profit structure allows their banking counterparts to outpace them in allocating resources for cyber defenses. While credit unions are deeply committed to protecting member data, their budgetary constraints might limit their ability to invest in the most advanced cybersecurity technologies and staff. This can make keeping up with the latest cybersecurity tools and practices challenging.
Cyber criminals might perceive credit unions as having less sophisticated defense systems than larger banks, potentially making them more attractive targets for cyber attacks.
Given their smaller scale, credit unions may face more significant challenges in providing continuous cybersecurity training and awareness programs for their staff and members, which are crucial in combating cyber threats like phishing.
The Early Days and Digital Revolution
On the cold and windy morning of April 6th, 1909, St. Mary’s Cooperative Credit Association, the first U.S. credit union, opened in Manchester, New Hampshire with assistance from Alphonse Desjardins.
But we must give credit where it is due – eighty-five years later, in 1994, Stanford Federal Credit Union was the first institution to launch online banking services in North America.
Earlier cyber attacks on credit unions were typically more rudimentary than today’s sophisticated threats. They often identified and followed easy vulnerabilities such as fraud, phishing, or attempts to breach network security. New vulnerabilities were discovered due to credit unions introducing more complex digital solutions, which led to an increased frequency and sophistication of cyber attacks.
In addition, client experience methodologies needed to evolve, leading to cybersecurity awareness. At the time, credit unions primarily relied on transactional relationships with third-party security providers and had yet to benefit from a personalized and structured approach to cybersecurity.
The dawn of the digital era signaled a challenging and bumpy road ahead filled with security potholes and vulnerabilities.
The Rise of Sophisticated Cyber Threats
The first decade of the 21st century saw the transition from relatively simple, isolated incidents to more complex, organized, and financially motivated cyber crimes.
- Advanced techniques like polymorphic code (which changes every time it runs) and targeted attacks started the trend. The rise of botnets (networks of infected computers controlled by an attacker) became a significant trend. These were used for various purposes, including distributed denial-of-service (DDoS) attacks, spamming, and credential theft. Notable botnets from this era include Conficker, Storm, and Zeus.
- More sophisticated cyber attacks followed, such as advanced persistent threats (APTs), ransomware, and phishing scams.
- High-profile data breaches started to make headlines, with attackers targeting customer databases of large companies to steal personal and financial information. Credit card information and personal identifiers were particularly sought after.
- These developments added to credit unions’ challenges in ensuring client trust and security. Stricter National Credit Union Administration (NCUA) standards that followed the Federal Financial Institutions Examination Council (FFIEC) guidelines aimed at protecting the credit unions’ members and communities were developed.
The decade between 2000 and 2010 laid the groundwork for many cybersecurity challenges and strategies that are still relevant today. It was a period of rapid technological change, and the cyber threat landscape evolved quickly, leading to a perpetual race between attackers and defenders.
The Modern Landscape of Cybersecurity in Credit Unions
From 2010 until today, credit unions have entered the next chapter of the digital revolution with the rise of mobile banking, cloud services, and AI, along with their associated vulnerabilities, such as application-based threats, data breaches, etc.
Combating vulnerabilities became a daily battle for us at CISO Global. We now include multiple layers of security:
- MDR (Managed Detection and Response)
- SIEM (Secure Information and Event Monitoring)
- XDR (Extended Detection and Response)
- IR (Incident Response), and many more.
With CISO Global by their side and seeking cybersecurity partnerships, credit unions are now entering into functional relationships to take advantage of client experience methodologies central to cybersecurity strategies. User education, multi-factor authentication, personalized security protocols, and cybersecurity awareness and training are a few.
From a cat-and-mouse game, protecting the member data is now a full-on cyber warfare involving the latest technologies from both sides in a never-ending battle for privacy and its protection.
Proactive Measures and Client Experience Methodologies
Credit unions employ many proactive cybersecurity measures, including regular audits, risk management practices, penetration testing, disaster recovery testing, and keeping software up to date.
Some credit unions enjoy the enhanced role of client experience methodologies in cybersecurity by introducing user-friendly security tools, collaborations with IT steering committees, board presentations, and transparent communications during breaches.
Considering credit unions’ unique positions in the communities, CISO Global helps implement multi-factor authentication, member education and awareness programs, personalized security alerts, user-friendly online and mobile banking platforms, advanced fraud detection systems, participation in collaborative security initiatives, data encryption and secure data in transit and at rest, incident response plans, and many more.
Staying on the sideline is not an option for credit unions. They chose to be the great leaders of their communities and are becoming leaders of the digital economy by building effective relationships with cybersecurity providers and benefiting from new practices of client experience.
Future Trends and Emerging Threats
The trends in cyber vulnerabilities have entered a new spiral, which prompts us to envision some potential threats from quantum computing, AI-powered cyber attacks, deepfakes and advanced phishing, Internet-of-Things vulnerabilities, supply chain attacks, ransomware evolution, regulation and compliance challenges, and insider threats with human errors.
In response to these emerging threats, credit unions must continually adapt their cybersecurity strategies, invest in new technologies, and educate their members and staff about evolving risks. The future of cybersecurity will likely involve a combination of advanced technological solutions and robust policy frameworks to mitigate these sophisticated threats by integrating advanced client experience methodologies.
How to Prepare
As we look forward, credit unions must embrace their role as custodians of trust and security in the digital economy. The call is clear: to evolve, innovate, and collaborate in our relentless pursuit of cybersecurity excellence, ensuring the safety of member data and the integrity of our digital financial systems. The future of credit unions in the digital age depends on how they respond to these challenges and how they anticipate and shape the cybersecurity narratives of tomorrow.
The evolving nature of cyber threats only emphasizes the importance of staying vigilant. Gone are the days of AOL’s friendly “You’ve got mail” greeting and our excitement at exploring the new digital frontiers. Instead, we get messages on our phones prompting us to scan a QR code to receive a lost UPS package, only to find out later that our TV set has been compromised.
The role of client experience methodologies in maintaining robust cybersecurity defenses is evolving to assist credit unions in learning and conveying the latest cyber threats and vulnerabilities in a friendly, repeatable manner, educating the community leaders and members to be fully aware of the landscape.
Credit unions must continuously adapt and improve their cybersecurity strategies as their members’ needs and expectations evolve.