The world of finance is a tempting target for cybercriminals, and as we move further into the digital age, data breaches are becoming more frequent and sophisticated. From banking giants to small financial service providers, no one is immune to the risk of a cyber attack. In 2020-2022 alone, several notable data breaches occurred in the financial industry, exposing sensitive information such as credit card numbers, social security numbers, and bank account details of millions of people. In this article, we will look through the recent data leaks in 2020-2022 in finance over the past few years and explore how they happened. We’ll also examine the impact these breaches had on businesses and customers alike while providing insight into where most cyber attacks come from. So buckle up and get ready to learn about what happens when cybersecurity fails in the world of finance!
10 Biggest Data Breaches in Finance
The financial sector is a prime target for cybercriminals due to the valuable data it holds and the increasing digitalization of financial services. To help mitigate data breaches, learning from past mistakes is crucial. UpGuard has compiled a regularly updated list of the 10 biggest data breaches in finance, ranked by impact. In 2020-2022 alone, several notable breaches occurred, including the SolarWinds hack that affected multiple government agencies and financial institutions. Other notable breaches include Capital One’s breach in 2019, which exposed over 100 million records, and Equifax’s breach in 2017 which compromised the sensitive information of over 143 million people. It’s essential for financial service providers to take proactive measures such as implementing specific data protection solutions to prevent future attacks and protect customer trust.
One of the most significant data breaches in finance occurred in 2020 when the SolarWinds hack affected multiple government agencies and financial institutions. The attack was carried out by a sophisticated group of hackers believed to be backed by a foreign government. The attackers exploited vulnerabilities in SolarWinds’ software, gaining access to sensitive data across several organizations. As a result, millions of individuals’ personal information was compromised, including social security numbers and financial information. The impact of the breach is still being felt today, as organizations work to identify and mitigate the damage done.
Another notable data breach occurred in 2019 when Capital One suffered a massive data breach that exposed over 100 million records. The attacker was able to exploit a vulnerability in the bank’s firewall, gaining access to sensitive customer information such as names, addresses, credit scores, and social security numbers. The breach was a wake-up call for financial institutions, highlighting the importance of proactive measures to prevent cyber attacks.
In 2017, Equifax suffered a massive data breach that compromised the sensitive information of over 143 million people. Hackers exploited a vulnerability in Equifax’s website software, gaining access to personal information such as names, social security numbers, birth dates, and addresses. The breach was a significant blow to consumer trust in the credit reporting industry and led to numerous lawsuits against Equifax.
While these were some of the most high-profile data breaches in finance over the past few years, they are just a small fraction of the total number of attacks that occur each year. Most cyber attacks on financial service providers come from external sources, such as hacking groups, nation-state actors, and even insider threats. It’s crucial for financial institutions to stay vigilant and take proactive measures to protect their data and their customer’s information.
From January 2018 to June 2022, financial services experienced significant data breaches, including the Capital One breach in 2019, where an intruder unlawfully obtained personal and banking information from approximately 100 million credit card users. In 2021, a significant breach took place at Cash App Investing wherein the personal data of approximately 8.2 million customers got leaked due to an unauthorized download of internal reports by a former employee.
In addition to these significant breaches, there were several other notable incidents that impacted millions of customers’ sensitive information. In 2019, American Medical Collection Agency suffered a breach that exposed over 20 million patient records, including social security numbers and medical histories. In the same year, First American Financial Corp suffered a “Business Logic Flaw” which led to the exposure of more than 885 million personal and financial records linked to real estate transactions.
These incidents highlight the need for financial institutions to prioritize cybersecurity measures and invest in advanced technologies that can prevent future attacks. Failing to do so can result in severe consequences such as reputational damage, loss of customer trust, and legal repercussions.
As technology continues to advance, the risk of cyberattacks on financial institutions increases. It is crucial for these companies to take proactive steps toward safeguarding their customers’ data and preventing future breaches. In the next section, we will explore data breaches by the type of financial company and the impact they have had on consumers.
How did the data breach occur?
One of the significant data breaches in the financial sector occurred in 2020 when more than 885 million personal and financial records linked to real estate transactions were exposed through a common website design error. The flaw, known as a “Business Logic Flaw,” was present on First American Financial Corp’s website, which led to webpage links containing sensitive information being unprotected by an authentication policy. This vulnerability enabled internal employees to access customer data without any verification, causing a data leak event. Although data leaks and data breaches differ, both can lead to cybercriminals’ access to sensitive customer information. In this case, the exposure wasn’t initiated by hackers but was caused by an internal mistake. It highlights the importance of implementing robust security measures and taking proactive steps to prevent future attacks that can damage customer trust significantly.
Financial services data breaches have become increasingly common in recent years due to the high value of information held by financial institutions and the increasing digitalization of financial services. Hackers often target these institutions to gain access to sensitive customer information, such as social security numbers, credit scores, and financial records. Learning from past mistakes is essential for mitigating future breaches, and it’s crucial for financial service providers to implement robust security measures and regularly update their systems to stay ahead of cyber threats. Customers also have a role to play in protecting their data by using strong passwords, monitoring their accounts regularly for suspicious activity, and reporting any incidents of fraud immediately. As the financial industry continues to evolve and become more digitally focused, it’s essential to prioritize cybersecurity to maintain customer trust and protect sensitive information.
Data breaches by the type of financial company
According to data since 2148, insurance companies have been the primary target for financial data breaches with a percentage of 23%, while banks and investment companies are next in line. Over the years, insurance companies have experienced substantial growth in data breaches.
While financial institutions prioritize cybersecurity measures, there is always a risk of cyberattacks as technology continues to advance. Therefore, it’s crucial for these companies to take proactive steps toward safeguarding their customers’ data and preventing future breaches. Data breaches can result in severe consequences such as reputational damage, loss of customer trust, and legal repercussions. Protecting sensitive information should be a top priority for all financial institutions to maintain consumer confidence in their services.
In a world where data breaches are becoming increasingly common, financial institutions must remain vigilant in protecting their customers’ valuable information. Remember, prevention is key to safeguarding against cyber attacks and maintaining consumer trust.
But what happens when a breach does occur? The cost of a breach can be staggering, both financially and in terms of reputational damage.
When a data breach occurs in the financial sector, it can have significant consequences for both the company and its customers. The cost of a breach can be staggering, with the average cost per record compromised being $150. This means that even small-scale breaches can result in millions of dollars in losses.
In addition to financial losses, data breaches can also cause reputational damage to companies. Customers may lose trust in the institution and may choose to take their business elsewhere. This can result in long-term financial repercussions for the company.
To prevent data breaches from occurring, financial institutions must prioritize cybersecurity measures and implement robust security protocols. Regularly updating systems, conducting regular security audits, and providing employee training are all essential steps toward protecting sensitive customer information.
The biggest-known Financial services data breaches
Capital One
One of the most significant financial services data breaches in recent years occurred in 2020 when Capital One suffered a massive cyber attack, resulting in the exposure of over 100 million customers’ personal information. The breach was caused by a misconfigured firewall that allowed a hacker to gain access to sensitive customer data stored on Amazon Web Services (AWS) cloud servers.
The exposed data included names, addresses, phone numbers, email addresses, dates of birth, credit scores, and Social Security numbers. The breach also led to the theft of over 80,000 bank account numbers and approximately 140,000 Social Security numbers.
The Capital One data breach was one of the largest financial services breaches in history and resulted in significant financial losses for the company. The cost of the breach was estimated to be around $100 million, including legal fees, customer notification costs, and credit monitoring services for affected individuals.
The breach also had severe reputational consequences for Capital One. The company faced scrutiny from regulators, lawmakers, and the media, with many questioning its cybersecurity practices and data protection measures.
In response to the breach, Capital One announced several initiatives to improve its cybersecurity posture, including increased investment in security technology and processes, enhanced employee training, and closer collaboration with cloud service providers. The company also offered free credit monitoring and identity theft protection services to affected customers.
The Capital One data breach serves as a reminder of the importance of strong cybersecurity measures in the financial sector. It highlights the need for institutions to regularly assess their security protocols and stay up to date with emerging threats.
Cash App Investing
In May 2021, Cash App Investing, a popular mobile investing app, suffered a data breach that exposed the personal information of its users. The breach was caused by a third-party service provider that had access to Cash App Investing’s system. The compromised data included names, birth dates, Social Security numbers, and bank account details of over 7 million customers.
The incident resulted in Cash App Investing notifying affected customers and providing them with free credit monitoring services. The company also stated that it had taken immediate steps to address the vulnerability and enhance its security measures.
However, the Cash App Investing data breach highlights the risks associated with third-party service providers and the importance of conducting thorough security assessments of vendors before granting them access to sensitive data.
Infinity Insurance Company
In June 2021, Infinity Insurance Company suffered a ransomware attack that compromised the personal data of its customers. The attackers, believed to be REvil, demanded a ransom payment of $25 million to restore access to the stolen data.
The breach exposed sensitive information such as names, addresses, social security numbers, and driver’s license numbers of over 2.5 million customers. In response, Infinity Insurance Company notified affected customers and provided them with free credit monitoring and identity theft protection services. The company also stated that it had taken steps to enhance its security measures and prevent future incidents.
The Infinity Insurance Company data breach serves as a reminder of the growing threat of ransomware attacks and the need for companies to have robust cybersecurity measures in place. It also highlights the importance of regularly conducting security assessments and implementing strong incident response plans to minimize the impact of data breaches.
As cyber threats continue to evolve, financial institutions must remain vigilant in their efforts to protect themselves and their customers from data breaches. This includes investing in advanced cybersecurity technologies, regularly training employees on best practices for data security, and conducting regular vulnerability assessments.
In addition, companies must prioritize vendor risk management by thoroughly vetting third-party service providers before granting them access to sensitive data. It is also important for companies to have a comprehensive incident response plan in place to quickly and effectively respond to any potential breaches.
Elephant Insurance Services
These high-profile data breaches serve as a reminder that financial institutions must remain vigilant in their efforts to prevent cyber attacks. The consequences of a breach can be severe, ranging from financial losses to damage to reputation and loss of customer trust.
In November 2021, Elephant Insurance Services suffered a data breach that exposed the personal information of over 100,000 customers. The attackers, believed to be REvil, demanded a ransom payment of $5 million to restore access to the stolen data.
The breach compromised sensitive information such as names, addresses, dates of birth, and driver’s license numbers. In response, Elephant Insurance Services notified affected customers and offered them free credit monitoring and identity theft protection services. The company also stated that it had taken steps to enhance its security measures and prevent future incidents.
The Elephant Insurance Services data breach highlights the need for financial institutions to prioritize cybersecurity measures to protect their customer’s sensitive information. It also underscores the importance of having a strong incident response plan in place to minimize the impact of data breaches.
Financial institutions must take proactive steps to protect themselves from cyber attacks, including investing in advanced cybersecurity technologies, regularly training employees on best practices for data security, and conducting regular vulnerability assessments. They must also prioritize vendor risk management by thoroughly vetting third-party service providers before granting them access to sensitive data.
The increasing trend of cybercriminals targeting critical infrastructure highlights the need for financial institutions to be prepared for potential ransomware attacks and have contingency plans in place to mitigate the impact of such incidents. It is also important for companies to collaborate with law enforcement agencies and share information with other financial institutions to enhance their collective defenses against cyber threats.
Texas Department of Insurance
These incidents highlight the ongoing threat that financial institutions face from cyber attacks. It’s crucial that companies remain vigilant in their efforts to prevent breaches and have comprehensive response plans in place in case an attack does occur. By prioritizing cybersecurity measures, financial institutions can protect themselves and their customers from the potential financial and reputational damages of a data breach.
In August 2021, the Texas Department of Insurance suffered a data breach that exposed the personal information of over 5 million individuals. The attackers, believed to be REvil, demanded a ransom payment of $2.5 million to prevent the stolen data from being sold on the dark web.
The breach compromised sensitive information such as social security numbers, driver’s license numbers, and financial information. The Texas Department of Insurance immediately launched an investigation and notified affected individuals. They also offered free credit monitoring and identity theft protection services.
Horizon Actuarial Services
In May 2021, Horizon Actuarial Services became the victim of a ransomware attack by REvil. The attackers demanded a ransom payment of $5 million to prevent the stolen data from being sold or leaked. The breach exposed sensitive information such as financial data, social security numbers, and personal identification numbers.
Horizon Actuarial Services immediately launched an investigation and notified affected individuals of the breach. They also worked with law enforcement agencies to identify the attackers and mitigate the impact of the incident.
The Horizon Actuarial Services data breach highlights the importance of having a strong incident response plan in place to minimize the impact of cyber attacks. Financial institutions should also regularly back up their data and conduct training and awareness programs for employees to prevent phishing scams and other malicious attacks. By taking proactive measures, financial institutions can protect themselves and their customers from the devastating effects of a data breach.
Australian Securities and Investments Commission (ASIC)
Another notable financial services data breach occurred in February 2021, when the Australian Securities and Investments Commission (ASIC) suffered a cyber attack. The attackers gained unauthorized access to the regulator’s server and stole confidential information about its clients.
The ASIC immediately launched an investigation and notified affected parties of the breach. They also worked with law enforcement agencies to identify the perpetrators and mitigate the impact of the incident.
Reserve Bank of New Zealand and TSYS
In addition to the above incidents, there were several other notable financial services data breaches in 2020-2022. In March 2021, the Reserve Bank of New Zealand suffered a cyber attack that compromised commercially and personally sensitive information. The attackers gained unauthorized access to the bank’s system through a third-party file-sharing service.
A data breach occurred in November 2020 at TSYS, a payment processing company. Over 130,000 individuals’ personal information was exposed, including names, addresses, birth dates, and social security numbers.
These incidents highlight the increasing threat of cyber attacks on financial institutions and the need for constant vigilance in preventing such attacks. Financial institutions must prioritize cybersecurity measures and invest in advanced technologies to protect their customers’ sensitive information. In addition, they must have a strong incident response plan in place to minimize the impact of a cyber attack if one does occur. By taking these proactive measures, financial institutions can protect themselves and their customers from the devastating effects of a data breach.
The cost of a breach
The cost of a data breach can be staggering for financial institutions. Not only is there the financial burden of repairing any damage done, but there is also the reputational damage that can result in lost customers and trust. According to IBM’s research, a phishing attack can cost businesses an average of $4.65 million, while Business Email Compromise (BEC) can cost an average of $5.01 million per breach.
It’s essential for financial companies to take proactive steps toward preventing breaches and protecting their customers’ sensitive information. However, even with strong cybersecurity measures in place, breaches can still occur. In these instances, it’s crucial for companies to have a plan in place to respond quickly and effectively to mitigate any damage done.
Preventing breaches should be a top priority for all financial institutions, as the cost of a breach can have severe consequences both financially and in terms of reputation. By remaining vigilant and taking proactive steps toward prevention, companies can maintain consumer confidence in their services and protect themselves from the costly aftermath of a data breach.
In today’s digital age, financial institutions must prioritize cybersecurity to safeguard their customers and their business. Remember, prevention is key, but having a solid plan in place can make all the difference when responding to an attack. And now, find out where most cyber attacks come from in the next section…
Where do most cyber attacks come from?
A study conducted by the Center for Strategic and International Studies (CSIS) showed that China and Russia have been involved in over 200 significant cyber incidents since 2006, making them the major cyber offenders. The rest of the world is listed as the third-worst offender, with Iran and North Korea closely trailing behind. Both India and the United States were implicated in significant cyber events. The results emphasize the importance of financial institutions prioritizing cybersecurity measures, such as prevention and response plans. Identifying the origin of cyber attacks can aid companies in preparing against potential threats and safeguarding their customers from expensive breaches. Financial institutions must maintain their vigilance to prevent attacks, as a breach can lead to significant financial and reputational consequences.
The financial sector is one of the most targeted industries for cyber attacks. In fact, according to a report by Accenture, financial services experience 300 times more cyber attacks than any other industry. The reasons for this are many, but primarily it’s because financial institutions hold valuable data that hackers can use for malicious purposes such as identity theft and fraud.
Cyber attacks on financial institutions can take many forms, including phishing attacks, malware infections, and ransomware attacks. These attacks can result in the theft of sensitive customer data, financial information, and intellectual property. The consequences of a breach can be severe for both the institution and its customers.
To minimize the risk of a cyber attack, financial institutions must prioritize cybersecurity measures such as regular security audits, employee training, and implementing robust security protocols.
Financial institutions face a constant threat of cyber attacks, with the frequency and severity of such incidents increasing every year. In 2020-2022, the financial services industry has seen several high-profile data breaches that have compromised the sensitive information of millions of customers.
The bottom line
In conclusion, financial services data breaches remain a significant concern for institutions and customers alike. While prevention is crucial, it’s also essential to have a plan in place to respond quickly and effectively to any attacks that do occur. With the frequency and severity of cyber-attacks increasing every year, financial institutions must prioritize cybersecurity measures such as regular security audits, employee training, and implementing robust security protocols. To stay ahead of the curve, financial institutions can also utilize innovative tools like test APIs to continuously monitor and improve their security measures. By taking proactive steps toward prevention and response, financial institutions can protect their customer’s sensitive data and maintain their reputation in the industry.