Ransomware Recovery: Strategies for Ensuring FI Business Continuity

 

In December 2023, a devastating ransomware attack targeted the cloud services provider Ongoing Operations, causing a widespread outage that impacted numerous credit unions. This incident served as a wake-up call for financial institutions and credit union leaders, highlighting the urgent need for robust business continuity strategies in the face of evolving cyber threats. Today we will explore the key steps credit unions can take to establish business continuity in the aftermath of a ransomware attack, ensuring the resiliency and security of their operations.

Understanding the Impact of a Ransomware Attack and the Importance of Business Continuity

A ransomware attack is a malicious cyber attack in which cybercriminals infiltrate a network, encrypt data, and demand a ransom payment in exchange for the decryption key. The consequences of a successful ransomware attack can be severe, ranging from financial losses and operational disruptions to reputational damage and legal liabilities. For credit unions, the impact of a ransomware attack can be particularly devastating, as it can compromise sensitive customer data and disrupt critical financial services.

The Ongoing Operations Ransomware Attack

In December 2023, the credit union industry experienced a major ransomware attack targeting Ongoing Operations, a prominent cloud services provider. This attack resulted in a widespread outage that affected numerous credit unions, causing disruptions to online banking services, member communication, and internal operations. The incident served as a stark reminder of the vulnerabilities faced by credit unions in the digital age and the need for proactive measures to mitigate the risks associated with ransomware attacks.

Building Resiliency Against Ransomware Attacks

To establish business continuity in the aftermath of a ransomware attack, credit unions must adopt a multi-layered approach that encompasses robust cybersecurity measures, comprehensive backup and disaster recovery solutions, and proactive incident response strategies. Let’s explore these key elements in detail.

1. Strengthening Cybersecurity Measures

Effective cybersecurity measures form the foundation of any business continuity strategy. Credit unions should implement a comprehensive set of cybersecurity controls to protect their networks, systems, and data from ransomware attacks. These measures may include:

  • Endpoint Protection: Deploying advanced endpoint protection solutions to detect and block malicious software before it can infect the network.
  • Network Segmentation: Implementing network segmentation to isolate critical systems and data from potential threats, limiting the spread of ransomware.
  • User Awareness Training: Conducting regular cybersecurity awareness training programs to educate employees about the risks associated with phishing emails, suspicious links, and other common attack vectors.
  • Patch Management: Keeping systems and software up to date with the latest security patches to address known vulnerabilities that can be exploited by ransomware.

By strengthening their cybersecurity measures, credit unions can significantly reduce the risk of a successful ransomware attack and enhance their overall resiliency.

2. Implementing Anomaly Detection Systems

Anomaly detection systems such as IMS’ Polaris Radar play a crucial role in early detection and prevention of ransomware attacks. These systems use advanced machine learning algorithms and behavioral analytics to identify abnormal patterns and activities that may indicate the presence of ransomware or other malicious activities. By monitoring network traffic, user behaviors, and file activity, anomaly detection systems can quickly detect and respond to potential threats, minimizing the impact of a ransomware attack.

3. Backup and Disaster Recovery Solutions

Having robust backup and disaster recovery programs is essential for establishing business continuity in the aftermath of a ransomware attack. Credit unions should implement regular, automated backups of critical data and systems. These backups should be stored in secure, offsite locations to ensure their availability in the event of a ransomware attack or other data loss incidents.

Additionally, credit unions should regularly test their backup and disaster recovery processes to ensure their effectiveness and reliability. Conducting mock recovery exercises can help identify any gaps or vulnerabilities in the backup strategy, allowing credit unions to make necessary improvements and adjustments.

4. Incident Response and Recovery Planning

In the event of a ransomware attack, a well-defined incident response plan is crucial for minimizing the impact and restoring normal operations as quickly as possible. Credit unions should develop a comprehensive incident response plan that outlines the roles, responsibilities, and communication protocols for responding to a ransomware attack. This plan should include:

  • Incident Identification and Reporting: Clearly defining the process for identifying and reporting a ransomware attack to the appropriate stakeholders, including internal IT teams, management, and external incident response partners.
  • Containment and Mitigation: Outlining the steps to contain and mitigate the impact of the ransomware attack, such as isolating affected systems, disconnecting them from the network, and implementing temporary measures to restore critical services.
  • Communication and Notification: Establishing communication channels and protocols for notifying affected parties, such as employees, customers, regulatory authorities, and law enforcement agencies. Timely and transparent communication is crucial for maintaining trust and managing the reputational risks associated with a ransomware attack.
  • Recovery and Restoration: Detailing the procedures for recovering encrypted data, restoring affected systems from backups, and implementing additional security measures to prevent future attacks.

By having a well-prepared incident response plan in place, credit unions can minimize the downtime and financial losses associated with a ransomware attack, allowing them to recover and resume normal operations swiftly.

Securing Business Continuity: Resilient Strategies

In today’s digital landscape, credit unions face increasing threats from ransomware attacks. Establishing business continuity in the aftermath of such attacks requires a comprehensive approach that combines robust cybersecurity measures, effective anomaly detection systems, reliable backup and disaster recovery solutions, and well-defined incident response and recovery planning. By prioritizing resiliency and taking proactive steps to mitigate the risks associated with ransomware attacks, credit unions can protect their operations, safeguard sensitive data, and maintain the trust of their members.

At IMS, we understand the importance of establishing business continuity in the face of evolving cyber threats. Our comprehensive suite of anomaly detection, backup, and disaster recovery solutions are designed to help credit unions increase their resiliency and protect against ransomware attacks. Connect with us to learn more about how IMS can support your credit union’s business continuity efforts.


Risk Management Strategies for Credit Unions

 

With fintech and general technology evolving at their current pace, credit unions must adopt effective risk management strategies that can safeguard their stability and promote growth. The economy’s uncertainty and volatility have transformed how the financial industry perceives risk, making it imperative for credit union boards and management to proactively identify and plan for potential risks. Today we’ll be exploring the importance of risk management for credit unions, examining the internal and external risk factors they face, and discussing strategies to effectively manage these risks.

The Importance of Risk Management for Credit Unions

In the past, credit unions relied heavily on financial projections to guide their operations. However, in today’s economy, financial projections alone are no longer sufficient to ensure the success of credit unions. To mitigate potential hazards and protect their business goals and objectives, credit union boards must have a comprehensive understanding of both short-term and long-term risks. While long-term risks are crucial, it is essential not to overlook the potential impact of short-term risks, as they can escalate into significant challenges over time.

Credit unions face a wide range of risks, each posing unique challenges and requiring careful consideration and proactive management. By being equipped with the knowledge of these risks, credit unions can develop risk management plans that minimize their impact when they occur. This proactive stance not only safeguards the credit union’s assets but also strengthens its overall stability and growth.

Internal and External Risk Factors for Credit Unions

To manage risks effectively, credit union leadership should first identify and understand internal and external factors that could impact their financial stability and operations. Recognizing these risk factors allows credit unions to develop targeted risk management strategies to mitigate their potential impact.

Internal Risk Factors

  1. Credit Risk: This risk arises from borrowers or members failing to repay their loans or debts, leading to asset quality deterioration and financial losses.
  2. Operational Risk: Inadequate or failed internal processes, human errors, technological failures, fraud, and other disruptions can result in financial losses or damage to the credit union’s reputation.
  3. Compliance and Regulatory Risk: Credit unions must adhere to numerous laws, regulations, and industry standards. Failure to comply with these requirements can lead to penalties, legal actions, or reputational damage.
  4. Liquidity Risk: The risk of not having sufficient liquid assets to meet short-term obligations, which could impact the credit union’s ability to function effectively and serve its members.
  5. Interest Rate Risk: Fluctuations in interest rates can affect profitability and the value of assets and liabilities, as credit unions often have a significant portion of their assets and liabilities tied to interest rates.
  6. Strategic Risk: This refers to the risk associated with the credit union’s strategic decisions, such as entering new markets, introducing new products, or expanding services.
  7. Reputation Risk: Negative publicity, customer dissatisfaction, or public perception issues can damage the credit union’s reputation and erode member trust.

External Risk Factors

  1. Economic Conditions: Changes in the broader economic environment, such as economic downturns, inflation, or recession, can impact borrowers’ ability to repay loans and affect the credit union’s financial performance.
  2. Market Risk: Fluctuations in financial markets, including interest rates, foreign exchange rates, and stock prices, can impact the credit union’s investment portfolio and overall financial health.
  3. Regulatory Environment: Changes in laws, regulations, or policies can impose new compliance requirements or restrict certain activities, affecting the credit union’s operations and profitability.
  4. Technological Advancements and Cybersecurity: While technological advancements can enhance competitiveness, they also introduce new cybersecurity threats and vulnerabilities that credit unions must address. Boosting cyber hygiene can help mitigate this risk.
  5. Competitive Landscape: Credit unions face competition not only from other financial institutions but also from emerging fintech companies, which can affect market share and member acquisition.
  6. Natural Disasters and Catastrophic Events: Natural disasters or catastrophic events can disrupt operations, damage physical assets, and affect the credit union’s ability to serve its members.

Understanding and effectively managing these internal and external risk factors is crucial for the long-term success and sustainability of credit unions. Credit union leadership must work closely with management to develop robust strategies that mitigate these risks and ensure the credit union’s stability and growth.

Key Risk Management Tactics for Credit Unions

To effectively address potential risks, credit unions can employ various risk management tactics. These tactics aim to identify, analyze, and prioritize risks, as well as develop proactive measures to prevent losses and recover from any adverse events. Here are some key risk management tactics for credit unions:

  1. Utilize Available Data for Decision Making: Credit union boards should leverage historical data to make informed decisions related to risk management. Analyzing past risks and their impacts provides valuable insights for managing future risks.
  2. Track Key Risk Indicators (KRIs): Tracking KRIs allows credit union boards to identify early warning signs of risk exposures. KRIs are metrics used to manage risks and assess the potential consequences of those risks.
  3. Employ Technology to Manage Regulatory Compliance: Credit unions can streamline their risk management processes and optimize staff allocation by utilizing technology. This helps ensure compliance with regulatory requirements while reducing manual, time-consuming tasks.
  4. Proactively Manage Collections: Investing in technology to streamline the collections process can make it more effective and efficient. Offering self-service options for borrowers can improve response rates and minimize credit risks.
  5. Leverage Data Insight: Data mining programs can help credit unions maximize the value of the data they already collect. These programs provide insights into how to better respond to members’ needs and address potential risks.
  6. Stay Vigilant of Regulatory Changes: Credit union leadership needs to stay informed about changes in laws and regulations that may impact their operations. Maintaining compliance is essential to avoid penalties and legal actions.
  7. Collaborate with Other Financial Institutions: Sharing resources and collaborating with other financial institutions can help credit unions stay competitive. This is particularly beneficial when retaining repossession agents or dealing with shared third-party vendor services.
  8. Optimize Risk Services: Utilizing predictive modeling, insurance tracking, location services, and loss mitigation can help credit unions reduce risks and plan for the future.

By implementing these risk management tactics, credit unions can enhance their ability to identify, assess, and mitigate potential risks, ensuring the long-term stability and growth of their operations.

The Benefits of a Risk Management Plan

A well-developed risk management plan offers numerous benefits to credit unions. These benefits include:

  1. Resource Protection: Risk management plans help protect valuable resources such as people, property, assets, time, and income. They ensure that credit union facilities and environments are safe for staff, customers, and visitors.
  2. Strengthened Stability: Risk management plans safeguard people, the environment, and credit union assets from harm, thereby strengthening the overall stability of operations.
  3. Reduced Legal Liability: A competent risk management plan can reduce legal liability and the threat of potential litigation. By identifying and mitigating risks, credit unions can minimize the likelihood of facing legal challenges.
  4. Cost-Effective Insurance: Risk management plans allow credit unions to work with insurance companies to define their insurance needs while keeping premiums as low as possible. This ensures cost-effective insurance coverage without compromising on protection.

Credit unions face various risks from both internal and external sources, and it’s crucial to prioritize risk management for their long-term success. As credit unions address these challenges, considering backup and disaster recovery solutions becomes essential to secure and maintain their operations. 

IMS offers specialized backup and disaster recovery services for financial institutions, providing local backup options and secure off-site replication. This ensures that credit unions are safeguarded against potential disasters or cyber threats, allowing for quick and efficient recovery to minimize disruptions. 

Adopting sound risk management strategies is key for credit unions to navigate the complexities of the financial industry. Let’s talk about how our solutions can help proactively manage internal and external risks, and empower your credit union to thrive in an ever-changing financial landscape.


How Artificial Intelligence is Transforming Credit Unions

 

Artificial intelligence (AI) has become a part of our daily lives. More often than not, the average consumer isn’t even aware of how deeply integrated it already is. From voice assistants to recommendation algorithms, AI is making its mark on industries and influencing customer expectations. Financial institutions, including credit unions, are also adopting AI to meet these changing demands and stay competitive. Let’s explore how credit unions, even with smaller budgets and teams, can effectively leverage AI to drive success in the digital age.

The Importance of Artificial Intelligence in Credit Union Operations

As credit unions navigate the challenges of the modern financial landscape, AI offers a host of benefits. By harnessing the power of AI, credit unions can streamline operations, enhance member experiences, and make data-driven decisions that drive growth. Take a look at some key areas where AI can make a significant impact on your credit union:

1. Personalized Member Experiences

AI-powered technologies, such as chatbots and virtual assistants, enable credit unions to provide personalized and efficient member experiences. These intelligent systems can handle routine member queries, assist with account management, and even offer financial advice tailored to individual needs. By leveraging AI, credit unions can deliver exceptional member service, building trust and loyalty in an increasingly digital world.

2. Fraud Detection and Prevention

Fraud detection and prevention are key concerns for credit unions. AI algorithms can analyze vast amounts of data to identify patterns and anomalies that indicate potential fraudulent activity. Machine learning algorithms can continuously learn and adapt to new fraud patterns, enhancing the accuracy and efficiency of fraud detection systems. By leveraging AI in fraud prevention, credit unions can safeguard their members’ assets and protect their reputation.

3. Risk Management and Compliance

Credit unions face various risks, including credit risk, compliance risk, and reputational risk. AI-powered risk management systems can analyze extensive datasets, identify potential risks, and provide proactive solutions to mitigate these risks. Additionally, AI can help credit unions stay updated with changing regulatory requirements, ensuring compliance and avoiding penalties. By adopting AI-based risk management solutions, credit unions can enhance their strategic decision-making processes and protect their long-term sustainability.

4. Data Analysis and Decision-Making

Data analysis is crucial for credit unions to gain insights into member behavior, market trends, and operational efficiency. AI-powered analytics tools can process vast amounts of data quickly and accurately, uncovering meaningful patterns and trends. This empowers credit unions to make data-driven decisions, tailor their products and services to member needs, and identify new growth opportunities. By leveraging AI in data analysis, credit unions can stay ahead of the competition and drive business success.

Overcoming Challenges: How Credit Unions Can Embrace Artificial Intelligence

While AI offers immense potential for credit unions, there are challenges to consider, such as limited budgets and resources. However, with a strategic approach, credit unions can effectively embrace AI and compete in the evolving digital landscape. Here are some strategies to consider:

1. Collaborate with Fintech Partners

Credit unions can collaborate with fintech partners specializing in AI solutions. These partnerships can provide access to cutting-edge AI technologies without the need for significant upfront investments. By leveraging the expertise of fintech partners, credit unions can navigate the complexities of AI implementation and ensure successful integration into their operations.

2. Start Small and Scale

Implementing AI solutions can be overwhelming, especially for credit unions with limited resources. It’s essential to start small and focus on specific use cases that align with the credit union’s goals and member needs. By starting with manageable projects, credit unions can gain valuable experience and gradually expand their AI capabilities.

3. Invest in Employee Training

Successful AI implementation requires a workforce equipped with the necessary skills and knowledge. Credit unions should invest in training programs to upskill their employees and build an AI-ready workforce. This investment not only enhances the credit union’s AI capabilities but also empowers employees to embrace and leverage AI technologies effectively.

4. Prioritize Data Security and Privacy

As credit unions adopt AI, ensuring data security and privacy is paramount. Credit unions must comply with data protection regulations and implement robust security measures to safeguard member information. By prioritizing data security and privacy, credit unions can build trust with their members and maintain a strong reputation.

Keep Sensitive Data Safe Alongside AI Implementation with IMS 

As credit unions embrace the boundless potential of artificial intelligence to personalize member experiences, fortify against fraud, and navigate intricate risks, they require a strategic and resilient safeguard. 

IMS’s Polaris Radar provides a crucial layer of protection through its advanced anomaly detection service, ensuring rapid recovery and bolstering credit unions’ security posture. This isn’t just about adopting AI — it’s also about securing your credit union with cutting-edge resilience. Connect with IMS to learn how our anomaly detection services can empower your credit union in providing secure, community-focused banking experiences.


10 Credit Union IT Priorities for 2024: Navigating Digital Challenges

 

As the year comes to a close, credit unions are gearing up to face the challenges and opportunities that lie ahead in 2024. In an increasingly digital world, credit unions must prioritize their digital efforts to stay competitive, meet member expectations, and navigate the evolving financial landscape. This blog post explores the top credit union IT priorities in 2024, focusing on the challenges they’re expected to face and the strategies they can employ to thrive in the digital age.

1. Embracing Digital Transformation

In today’s fast-paced world, digital banking has become a necessity. Credit union members expect seamless online banking experiences, including mobile apps, 24/7 service, and digital transaction processing. To meet these expectations, credit unions must embrace digital transformation. This involves investing in technology and training to provide members with the convenience and accessibility they demand.

One crucial aspect of digital transformation is the integration of artificial intelligence (AI) into credit union operations. AI technologies, such as generative and conversational AI, can automate customer service, increase sales and conversions, streamline member experiences, and reduce call center workload. By leveraging AI, credit unions can enhance member engagement and deliver personalized services at scale.

2. Ensuring Regulatory Compliance

The financial sector is heavily regulated, and credit unions are no exception. Staying compliant with ever-changing local, federal, and international regulations requires a dedicated focus on regulatory compliance. Credit unions must allocate resources for ongoing training, maintain good data practices, and implement compliance programs to ensure they meet their obligations. By prioritizing regulatory compliance, credit unions can foster trust and confidence among their members.

3. Enhancing Cybersecurity Measures

As digital banking becomes more prevalent, credit unions face increased cybersecurity threats. Cybercriminals target financial institutions of all sizes, and credit unions, with their smaller IT teams, may be perceived as easier targets. Protecting members’ sensitive data and maintaining trust is of paramount importance. Credit unions must invest in robust cybersecurity measures, including advanced threat prevention systems, anomaly detection, regular security audits, employee training, and incident response plans. By staying vigilant and proactive, credit unions can safeguard their members’ information and maintain a secure banking environment.

4. Competing with Larger Banks and Fintechs

Credit unions often find themselves competing against larger banks and fintech companies that have significant resources at their disposal. To remain competitive, credit unions must leverage their unique strengths, such as their local presence, personalized service, and community focus. Credit unions should also explore partnerships with fintech companies like IMS to enhance their technological capabilities and offer innovative products and services. By embracing collaboration and innovation, credit unions can carve out their niche in the financial services landscape.

5. Increasing Membership Growth and Awareness

While credit unions offer numerous advantages over traditional banks, many potential members are unaware of these benefits. Credit unions must invest in targeted marketing and education efforts to raise awareness about their services and attract new members. Collaborating with community organizations, leveraging social media platforms, and participating in local events can help credit unions reach a broader audience and highlight their value proposition. By effectively communicating their unique benefits, credit unions can drive membership growth and expand their reach.

6. Engaging Younger Members

One challenge that credit unions face is the aging membership demographic. To ensure long-term sustainability, credit unions must engage younger members and tailor their services to meet their preferences. Younger generations have higher expectations for digital experiences, so credit unions must invest in user-friendly online and mobile banking platforms. Offering personalized financial advice, educational resources, and innovative product offerings can also attract and retain younger members. By adapting to the needs and preferences of younger generations, credit unions can future-proof their member base.

7. Attracting and Retaining Talent

In an increasingly competitive job market, credit unions must prioritize talent acquisition and retention. To attract tech-savvy professionals, credit unions should showcase their commitment to digital transformation, offer training and development opportunities, and provide a positive work environment. Building a strong employer brand and cultivating a culture of innovation can help credit unions attract and retain top talent. By investing in their workforce, credit unions can build a team capable of driving technological advancements and delivering exceptional member experiences.

8. Expanding Service Offerings

Credit union members expect a wide range of services from their financial institutions. To meet these expectations, credit unions should consider diversifying and expanding their service offerings. This may include specialized loans, insurance products, investment advice, and financial planning services. Offering these services digitally or online is a significant leap forward. By providing comprehensive financial solutions, credit unions can become a one-stop shop for their members’ needs and strengthen member loyalty.

9. Streamlining Technological Integration

Integrating new technology solutions into existing infrastructures can be a complex process for credit unions. They must ensure that new systems seamlessly integrate with their legacy systems and workflows. Credit unions should seek technology vendors and partners that offer flexible and scalable virtual cloud solutions. By streamlining technological integration, credit unions can leverage the power of emerging technologies without disrupting their operations.

10. Navigating Economic Uncertainties

Credit unions, like other financial institutions, face economic uncertainties such as recessions, interest rate fluctuations, and geopolitical events. During economic downturns, credit unions must prioritize the stability of their operations, safeguard sensitive financial information, and uphold the confidence of their members. Having a resilient disaster recovery strategy and contingency plans in place is crucial for credit unions to weather these uncertainties. Credit unions should regularly assess their risk exposure, stress test their loan portfolios, and maintain adequate capital reserves. By adopting a proactive approach to risk management, credit unions can mitigate potential financial downturns and ensure their long-term sustainability.

Credit Union IT Priorities: Staying Competitive in the Digital Age

By embracing digital transformation, ensuring regulatory compliance, enhancing cybersecurity measures, and leveraging their unique strengths, credit unions can navigate the challenges ahead. Engaging younger members, attracting and retaining top talent, expanding service offerings, streamlining technological integration, and preparing for economic uncertainties are also essential strategies for credit unions’ success. 

Focus on these key credit union IT priorities this 2024 to thrive in the ever-changing financial services landscape. Connect with IMS today and let’s talk about how we can help you provide your members with personalized, community-focused banking experiences.


10 Strategies for Boosting Credit Union Cyber Hygiene

 

As we recognize Cybersecurity Awareness Month, there’s no better time to reflect on why cybersecurity matters to the credit union community. Today’s interconnected world means there are near-infinite possibilities for credit union growth and member engagement. However, it also presents vast challenges, especially regarding credit union cyber hygiene. Threats from cybercriminals targeting financial institutions are constantly escalating, posing significant risks to sensitive member data and financial operations.

This blog aims to empower credit union leaders and IT professionals with effective strategies to bolster their institution’s cybersecurity efforts. By taking a proactive approach, you can considerably reduce the likelihood of a breach and protect your credit union.

Credit Union Cyber Hygiene: Safeguarding Member Data

The stakes are undeniably high. Did you know that the annual financial risks due to cyber threats can range from $190,000 for small credit unions to $1.2 million for large credit unions?  

Business email compromise schemes are by far the costliest financial cybercrime. According to research, victims of email compromise reported approximately $2.4 billion in losses in 2021 alone. These numbers underscore the importance of robust cyber hygiene practices for credit unions. Beyond the financial impact, consider the cost to your institution’s reputation, the potential loss of members, and the operational disruptions.

These trends cannot be ignored, and while daunting, they serve as catalysts for every credit union to prioritize its cybersecurity posture and scale up its defenses. Let’s take a look at 10 strategies for boosting your credit union cyber hygiene:

1. Perform Regular Audits and Assessments

Implementing rigorous audits and assessments will help identify vulnerabilities in your credit union’s security infrastructure. Routine assessments ensure proper security measures are in place and protocols remain updated when changes are made to the IT environment. Also, continuously examining server and workstation logs can effectively identify suspicious activities.

2. Educate Employees on Cyber Hygiene

Employees often constitute the first line of defense against cyber threats. Training is crucial to equip them with knowledge and practical skills to recognize and prevent phishing attacks, ransomware, and malicious downloads. Encourage safe practices, such as strong password management, to mitigate risks arising from human error.

3. Develop a Comprehensive Security Policy

Develop a comprehensive security policy addressing the credit union’s IT infrastructure, user authentication protocols, and data classification. This policy should outline procedures for reporting security incidents, handling sensitive information, and monitoring third-party service providers to ensure they adhere to data protection standards.

4. Deploy Multi-layered Security Measures

Implementing a multi-layered security approach enhances your credit union’s ability to withstand various threats and attacks. Deploying a combination of firewalls, intrusion detection and prevention systems (IDPS), email filtering, and spam protection reinforces security measures and ensures the swift detection of cyber threats.

5. Keep Hardware and Software Up-to-date

Software and firmware updates are essential to patch vulnerabilities and exploit loopholes that hackers use to infiltrate networks. Implement a systematic approach to managing updates, establishing clear patch timelines, and prioritizing the most critical vulnerabilities.

6. Optimize IT Utilization

Cyber resilience in credit unions can be substantially improved through the diligent use of technologies. While certain programs or infrastructure such as Microsoft 365 can bring significant benefits to credit unions, there is always a need for a proper understanding of security recommendations and best practices.

7. Secure The Cloud

The transition to cloud computing offers significant benefits, such as cost-saving on data storage and streamlined operations. However, the security of digital assets in the cloud remains a top concern. Credit unions should securely configure cloud services, encrypt sensitive data, and restrict access to authorized personnel to mitigate cloud-related risks.

8. Monitor Vendor Security and Risk Management

Credit unions often rely on third-party vendors to provide essential services and support operations. It’s crucial to diligently assess vendors’ security standards and risk management practices to ensure they align with your credit union’s expectations. Regular vendor audits and thorough risk assessments will strengthen your institution’s overall cyber hygiene.

9. Implement Robust Authentication Practices

Implement strong authentication mechanisms such as multi-factor authentication (MFA) to bolster access security for members and internal employees. MFA provides an additional layer of security beyond passwords and significantly reduces the risk of unauthorized access to sensitive information.

10. Plan for Disaster Recovery and Business Continuity

The ability to quickly recover from a cyber attack or security incident is crucial to maintaining a credit union’s operations and reputation. Develop a comprehensive disaster recovery and business continuity plan that includes frequent data backups, off-site storage of critical data, and protocols for resuming operations in case of a breach.

Elevating Credit Union Cyber Hygiene with Virtual Private Cloud Services

Protecting your credit union from cyber threats is an ongoing and evolving endeavor, necessitating a comprehensive and proactive approach. Implementing these strategies will help to significantly improve your credit union’s cyber hygiene, reducing the likelihood of a cyberattack and mitigating its impact if it does occur. By continuously monitoring and evaluating your institution’s security posture, you can stay ahead of threats and protect sensitive member data, ensuring trust and confidence in your credit union.

Partnering with a leading IT service provider like IMS can significantly streamline your credit union’s path to robust cybersecurity. Our Virtual Private Cloud Services — including backup, disaster recovery, Infrastructure-as-a-Service, compliance, and more — provide a comprehensive solution tailored specifically for credit unions. Connect with IMS to explore how we can help safeguard and empower your credit union with our industry-leading IT solutions.


Detecting and Preventing Financial Fraud: Safeguarding Credit Unions

 

As the financial services industry faces an unprecedented surge in attempted fraud, credit unions must strengthen their defenses to protect their assets and members’ data. Fraudsters continue to evolve their tactics, making it crucial for credit unions to adopt advanced technologies that can effectively detect and prevent fraudulent activities. In the battle against financial fraud, IMS’s Anomaly Detection service is a powerful tool, empowering credit unions to stay vigilant and combat fraudulent behavior effectively.

Let’s explore the current landscape of financial fraud and the key technologies credit unions can use for detection and prevention.

Addressing the Rising Tide of Financial Fraud

A TransUnion report has shed light on the alarming increase in attempted fraud within the financial services industry. Fraudsters have diversified their tactics, including money laundering, counter-terrorism fraud, synthetic identity theft through mule schemes, and peer-to-peer payment fraud. The constantly evolving market conditions contribute to the ever-increasing financial fraud risk, making it critical for credit unions to adopt proactive measures to detect and prevent fraudulent activities.

Recognizing the need for heightened security measures, 93% of credit unions have started funding security, authentication, or digital identity initiatives since 2021, according to research from PYMNTS.com. However, credit unions still lag behind other financial institutions in leveraging advanced technologies to combat financial fraud effectively. Traditional fraud prevention methods are no longer sufficient to counteract the speed and complexity with which fraudsters operate.

To fight this rising tide of financial fraud, credit unions and other financial institutions must leverage advanced technologies equipped with real-time monitoring capabilities. 

The Current Financial Fraud Landscape

Financial regulatory agencies, such as the U.S. Securities and Exchange Commission, the Federal Trade Commission, and the Financial Crimes Enforcement Network, have identified several prevalent fraud types that credit unions need to be vigilant about:

  • New Account Fraud: Criminals target accounts opened online or by phone to exploit vulnerabilities in the onboarding process.
  • Imposter Schemes: Fraudsters impersonate government agencies or other entities, offering fake services to deceive individuals and steal money or information.
  • Small Business Administration Loan Fraud: Schemes related to government initiatives like the Paycheck Protection Program and Economic Injury Disaster Loans have become a breeding ground for fraud.
  • Business Tax Credits Fraud: Criminals exploit tax credits intended for businesses for personal gain.

To address these incidents effectively, credit unions are increasingly focusing on key areas of risk mitigation. A PwC report highlighted data privacy and cybersecurity, the use of new technology, digital identity authentication, Anti Money Laundering (AML) efforts, Know Your Customer (KYC) procedures, and local regulatory pressures as key concerns for financial institutions.

Enhancing the Credit Union Business Model

While credit unions have historically been valued for their member-centric approach and personalized relationships, it is crucial to complement this model with a strong emphasis on digital solutions. Implementing strong authentication measures and investing in fraud prevention technology are important steps to prevent account takeovers and financial fraud. Unfortunately, many credit unions have been slow to adopt these technologies, making them prime targets for criminals.

Technologies Tackling Financial Fraud

To support their defenses against financial fraud, credit unions can leverage a range of advanced technologies, many of which rely on artificial intelligence and machine learning. These technologies play vital roles in fraud detection and prevention:

  • Member and Corporate Onboarding and Screening: AI-powered software can analyze member and corporate data in real time, identifying suspicious activities during the onboarding process.
  • Transaction Monitoring and Screening: Machine learning algorithms can monitor transactions in real-time, flagging unusual activities and potentially fraudulent behavior.
  • Transaction Fraud Detection: Advanced analytics and AI help detect fraud patterns, uncover hidden relationships among criminals, and reduce false positives. IMS’s Anomaly Detection solution, Polaris Radar, uses machine learning to actively monitor and generate alerts for suspicious activity. 
  • Sanctions and Watchlists Screening: AI-driven screening tools ensure compliance with regulatory requirements by identifying individuals or entities on watchlists.

By harnessing the power of artificial intelligence and machine learning, credit unions can achieve seamless, reliable, and strategic fraud and AML sanction compliance, significantly enhancing their ability to combat financial fraud.

Anomaly Detection: Empowering Credit Unions with Real-Time Fraud Detection

Detecting and preventing financial fraud is an ongoing challenge for credit unions and other financial institutions. With the threat landscape constantly evolving, embracing advanced technologies for real-time monitoring is crucial.

IMS’s Anomaly Detection service leverages the power of artificial intelligence and machine learning to analyze large volumes of transaction data. By establishing baseline behavioral patterns, the service can detect anomalies and deviations that might indicate fraudulent behavior. This proactive approach enables credit unions to identify potential threats swiftly and take decisive action to protect their members and financial assets.

Protect your credit union from the escalating threat of financial fraud. Explore IMS’s Anomaly Detection service today and connect with us at this link to find out how we can help meet your specific needs.


Ransomware Attacks are Only Getting Faster: How to Secure Your Credit Union

 

In cybersecurity, it’s a constant race with bad actors often seeming to be in the lead. But, with smart strategies and tools, credit unions can still effectively safeguard themselves.

Ransomware attacks are gaining momentum and complexity. These harmful software programs lock down access to computer systems or encrypt files, with attackers asking for a ransom to restore access. For credit unions that handle sensitive data, this threat is particularly concerning due to the potential monetary and reputational harm an attack can cause.

Ransomware Attacks: An Escalating Threat

Ransomware attacks have witnessed a steep rise in recent years. A shocking 75% of organizations reported being targeted by ransomware within the last year, with 38% experiencing multiple attacks, based on a survey from Barracuda Networks, Inc. The study further shared that email was the primary source for 69% of these ransomware attacks.

As ransomware continues to evolve and proliferate, new strains appear. One such example is the recently discovered Rorschach strain, one of the fastest on the market today.

In a trial conducted by Check Point on a 6-core machine with 22,000 files, all files were partially encrypted within 4.5 minutes by Rorschach. This rapid encryption speed dramatically reduces the available reaction time for a user or IT organization to a security breach, increasing the chances of a successful attack. Once successful, Rorschach can extend the ransomware to every machine in the domain, even if the initial attack targets just one machine.

Is Your Credit Union Equipped for This?

Despite the mounting prevalence of ransomware, more than 25% of companies do not feel adequately prepared to handle an attack. This feeling of unpreparedness tends to amplify as an organization grows larger, primarily due to the increased need for data protection and a larger surface to defend.

For credit unions, the aftermath of a ransomware attack can be catastrophic. Apart from the immediate financial setback from paying the ransom, there can be considerable costs associated with recovery, investigation, and system hardening post-attack. Plus, there’s the potential damage to reputation. Members trust credit unions with their sensitive financial data, and a breach could severely erode that trust.

6 Ways To Secure Your Credit Union Against Ransomware Attacks

So, how can credit unions protect themselves against this escalating cyber threat? Here are some practical strategies:

  1. Access Controls: By implementing strategies such as RBAC (Role-Based Access Control) or ABAC (Attribute-Based Access Control), you can ensure that each user only has the required level of access, preventing unauthorized data access.
  2. Password Policies: Adopt proper password policies that align with industry standards like NIST 800-63B and check for previously compromised account passwords.
  3. Multi-Factor Authentication (MFA): Incorporate two-factor authentication (2FA) or MFA to help reduce the risk of account compromises. MFA becomes particularly crucial for privileged accounts, as it bolsters account security even if a password gets stolen.
  4. Zero-Trust Architecture: Transition to a zero-trust architecture where every connection and action must be authorized and authenticated, eliminating the default trust granted to everything within a network.
  5. Penetration Testing: Carry out penetration testing to proactively identify and address potential security gaps.
  6. Data Backup: Maintain comprehensive data backups that cover your entire infrastructure, ensuring you can quickly recover your infrastructure and restore services and functionality even in the event of a ransomware attack.

Amplify Your Ransomware Defense with IMS’s Anomaly Detection

For credit unions aiming to boost their readiness and prevention against ransomware attacks, IMS offers Anomaly Detection powered by Polaris Radar technology. This advanced tool enables you to bounce back faster while enhancing your system’s intelligence. With Polaris Radar, you can track how your data evolves and moves, utilizing machine learning to identify and alert you of any unusual behavior. Enhance your cybersecurity strategy with the power of intelligent anomaly detection.


Essential Network Performance Metrics for the Financial Industry

 

Cybersecurity is a major concern for companies across all industries, especially in the financial sector. The financial industry is facing a unique set of challenges. With vast amounts of sensitive information being exchanged, organizations must take extra precautions to protect their data. To ensure that their networks are safe, financial institutions should be aware of key performance metrics.

Let’s discuss the top network performance metrics for the financial industry and why they’re important for organizations to understand.

Network Performance Metrics to Watch: Bandwidth

There are many instances when you hear phrases like “we don’t have the bandwidth for that.” Often, this conveys a sense that whatever solution or course of action you’ve proposed, the current infrastructure of your credit union can’t handle it. This is what makes bandwidth one of the essential network performance metrics for the financial industry.

Bandwidth is the term used to describe the rate of maximum data transfer in your network over a certain amount of time.

The goal is to monitor and optimize your network’s bandwidth without going over the limit.

If your favorite retail store encounters a bandwidth problem that leads to downtime on its website, it can regain the trust of customers with sales and smart marketing. But credit unions are financial institutions, something that people rely on 24/7. Downtime and bandwidth issues for you can mean the loss of lifelong members.

People want infinite and unlimited access to their financial accounts. They want faster funds transfers, instant deposits, and payment options. This doesn’t leave much room for error. In fact, it makes it more crucial for your credit union to ensure that you have the bandwidth to handle whatever may come. And in these uncertain financial times, there are so many variables that your members will look to you to plan for and protect them from.

Level of Preparedness

Level of preparedness is a network metric that helps you determine how many of the devices on your network are fully patched and up to date. This is an important metric for credit unions and other businesses in the financial sector because it can help you detect and eliminate vulnerable devices and services.

Scanning for and managing vulnerabilities can also greatly reduce security breaches and lower IT and other costs.

Security Incidents/Intrusion Attempts

How many times has an attacker gained access to your information, assets, and/or network? How many times has an attacker attempted to access these items? Those numbers tell a story.

Of course, no cybersecurity effort should be without a thorough and frequent look into security incidents and intrusion attempts. Keeping an eye on these numbers allows you to recognize vulnerability trends more quickly.

Effective network performance keeps your vulnerabilities low. This means your analysis of security incidents and intrusion attempts should yield consistent results over time. That is, your numbers will stay consistent if your IT operations continue to evolve to protect your data from the latest threats.

If your IT program isn’t keeping things secure, time is of the essence. And it saves you time to keep yourself and your credit union leadership teams apprised of the number of incidents month to month and year to year.

Packet Loss

Packet loss measures the number of data packets lost during a transfer between two destinations in your network. Packets are the tiny pieces of data that are being sent and received over digital channels. This includes everything from downloaded files to email correspondence and more. There are many things that cause packet loss from software issues to network congestion or router problems.

Here’s a helpful tutorial on how to test for and fix packet loss issues.

Unidentified Devices on Internal Networks

Though most people imagine a hacking or breach attempt as having originated from “outside the castle walls,” it’s important to remember that every employee and member who accesses your network has the ability to corrupt it.

Employees can introduce viruses and other malicious code via their personal devices and habits. This can lead to issues as you are working toward building an efficient IT network.  

Company vs. Peer Performance

A high-level KPI to watch for in the list of network performance metrics for the financial industry is company versus peer performance. An efficient IT network, especially in the financial sector, should be able to keep performance above the average level for your industry.

You can compare a range of basic network metrics, including many of the ones we listed above. There are several reporting companies that have industry averages available online for you to compare against.

This is a metric that is more important when it comes to positioning your success in the industry. In essence, you won’t need this metric to improve specific cybersecurity efforts. But you will need these comparisons to show your board members and other credit union leaders that you are aware of the industry standards and are working toward and achieving those levels at the time you report to these governing bodies.

Network Connection

Checking connection is a big performance metric for ensuring optimal network performance. This metric shows you the connectivity between all the devices, nodes, and systems in your network.

You can use this metric to find and minimize service interruptions before they cost you customers and important data or operations.

IMS uses the premier backup solution for credit unions. This allows you to keep your credit union data up to date and stored securely at an offsite IMS data center. In addition to backup and recovery, this Rubrik backup solution also includes continuous data protection, ransomware recovery, replication and disaster recovery, virtualized environments, and Windows and Unix protection.


2023 Credit Union Cybersecurity Predictions

 

As technology advances, so does the need for heightened credit union cybersecurity measures. When it comes to cybersecurity, credit unions must stay up to date with the latest threats in order to keep their members safe and secure.

As the world of technology continues to evolve, so do the challenges of keeping our data secure. Credit unions in particular face a unique set of cybersecurity threats that must be anticipated and prepared for. We will discuss how credit unions can leverage digital transformation to protect themselves and their members from malicious cyberattacks as well as explore emerging technologies that may be used to combat potential threats.

In this article, we will take a look at what experts predict are some of the major credit union cybersecurity predictions for 2023.

Credit Union Cybersecurity Will Be a Top Risk Management Concern

According to a recent NCUA article, the top 4 risk factors affecting the financial industry in 2023 include interest rate risk, liquidity risk due to inflation concerns, credit risk due to housing and loan market concerns, and cybersecurity risks due to geopolitical issues and growing dynamic threats.

In July 2022, NCUA approved a rule that requires credit unions to notify NCUA no later than 72 hours after they reasonably believe a reportable cyber incident has occurred. They have created and optimized their ACET (Automated Cybersecurity Evaluation Toolbox) and offer many free resources and checklists to credit unions aiming to adjust and evaluate risk management concerns for the new year.

“Passwordless” Solutions Are at the Forefront of Financial Cybersecurity Solutions

“Passwordless” solutions like MFA (multi-factor authentication) will continue to be a powerful tool in every credit union’s cybersecurity best practices toolkit. As the use of cloud computing and hybrid work and customer service solutions rises, so does the need to ensure all data, no matter where it is stored or sent, is protected by more than a password.

Password auto-fill options like the Google Smart Lock system continue to be popular in both personal and professional settings, and that can create rifts in security. But with MFA, those rifts can often be closed or avoided completely due to the hacker’s need to have more access and devices in order to complete the authentication process.

Because apps and cloud usage have exponentially expanded the attack surface for credit unions, these new technologies require advanced solutions that look much different than the ones that previously governed in-house servers and networks.

Phishing & Email Attacks Among Top Cybersecurity Threats for 2023

A recent article from Forbes outlines the top 5 scams that businesses should be watching for in 2023. They include:

  • Business email compromise (BEC): this includes the use of fake email accounts to harbor or spread threatening software and includes phishing attempts, ransomware, and more.
  • Malware and Ransomware: due to the current geopolitical climate surrounding the conflict between Ukraine and Russia, many political cybersecurity experts believe Russia will use its resources to continue launching ransomware attacks against those governments and entities that do not agree with its current political agenda.
  • Crypto Scams and “pig butchering” scams: Named for the phrase “raising a pig for slaughter,” these attacks start with a friendly message that entices the recipient to create an online relationship with the sender (hacker). As that trust grows, the hacker will then start questioning the recipient about their interests in crypto in an effort to get them to buy into a website that is reputed to have made someone a lot of money, only for that crypto to be stolen from the recipient’s accounts.
  • Cybercrime cash-out process innovation: This is an evolving scam that started with hackers and bad actors asking unsuspecting and uneducated individuals to send gift cards or cryptocurrency in an effort to get around the “cash-out,” where payments that surpass $10,000 and other high-value transactions can be tracked and flagged for suspicious activity.
  • Scamming as a Service: Virtual marketplaces in underground websites are creating and selling end-to-end services that “enable low-skill threat actors to fill their carts and pay with crypto,” Forbes says. These services include full sets of stolen credentials, ready-to-deploy ransomware, phishing, other attacks, and more. Even the bad guys love a good package deal.

Multi-Year Strategic Plans Work Best for Cybersecurity Success

Because cybersecurity threats are ever-changing, credit union and financial industry leaders must be prepared to put their money and their time into multi-year strategic plans. Cybersecurity is a complex beast, and everything and everyone that interacts with a network can create potential threat opportunities.

A mix of internal and external threats are often already beginning to make their way through secure areas, files, and devices throughout the year, and an improvement in key performance metrics, like a decrease in ransomware or phishing attempts, is no reason to ease off or to decrease your institution’s budget for cybersecurity personnel, services, and software.

Organizations with Cybersecurity Network Architecture Will Reduce Financial Security Costs By 90%

Does that sound too good to be true? It’s a certainty by 2024, according to Gartner’s cybersecurity predictions for 2023-2025. Those organizations that switch to a more holistic cybersecurity approach that encompasses not just their devices and network, but all technology that has access to or is integrated with it, are expected to see a 90% reduction in the final costs of security incidents.

Credit union cybersecurity threats are serious and should be caught early to minimize damage and data theft. That’s why IMS offers Polaris Radar, an anomaly detection software that enables your system to recover more quickly and easily from an attack on your credit union network security. Don’t get caught unawares, especially when your members’ personal and financial information may hang in the balance.


Top 4 Disaster Recovery Concerns and 2023 Cybersecurity Trends

 

2022 has almost come and gone already. Your credit unions are gearing up for holiday promotions and member requests, and before you know it, you’ll be writing “2022” on your transaction records and deposit slips and then crossing it out because you forgot we’re in 2023 now!

We all make mistakes, and some are inevitable, that’s why we wanted to shed some light on the most common disaster recovery concerns as well as highlight some of the biggest 2023 cybersecurity trends.

Mobile Banking is a Big Target

Because your members are doing more and more of their financial housekeeping from their smartphones, there are several reports that mobile banking malware attacks are on the rise – seeing an increase of more than 50% since 2019.

Today, the majority of fraudulent transactions are being initiated from mobile devices, and that includes things like malware, data tampering, phishing attacks, ransomware incidents, and data loss.

Mobile banking will likely remain a top concern for your credit union branches (and for financial institutions as an industry) through 2023 and beyond.

Enhancing the Digital Experience

The work-from-home and remote solutions culture is still going strong in 2022 – expect to see an increased fluidity with which people are completing their work, personal appointments, shopping, finances, and so much more.

This includes optimizing your member-facing digital and mobile assets and services, as well as increasing the efficiency of your employee offboarding. Getting non-employees off your servers and out of your access windows is arguably more important than getting them the access they need at onboarding.

Without access, a new employee’s productivity is slowed, sure, but without timely access revocation, your former employees can slow the productivity of your entire staff.

It’s no longer about training new hires faster, it’s about keeping the incoming and outgoing access requests efficient to minimize gaps in your access security.

Endpoint Security Will Continue to Be Big

One of the most common 2023 cybersecurity trends and disaster recovery concerns includes endpoint security. All these remote and mobile access points mean your credit union’s network has never been more vulnerable from more angles. The IoT (Internet of Things) creates more opportunities for people and businesses to connect, but that same connection can be used to exploit your credit union’s network vulnerabilities.

We’ll see bigger pushes for remote and virtual desktops, increased endpoint security, and more. Data and productivity protection will become top-priority items.

Downtime is something that many of your members are not going to tolerate – and that means using your resources to create big bank solutions on small business and independent credit union budgets.

To help determine your direction for 2023 cybersecurity success, the latter part of 2022 and the first part of 2023 are the perfect windows of opportunity for your credit unions and branches to do some thorough vulnerability assessments.

Including MFA (multifactor authentication) and other access, controls should be educational and operational frontrunners – keeping the right people in and the wrong people out can decrease your chances of a data breach substantially.

Cloud-Based Business Continuity

Too much of your endpoint management and security resides outside the walls of your credit union branches. There are so many branch-sharing initiatives and other remote and mobile banking trends that will continue to raise disaster recovery concerns and top the charts for 2023 cybersecurity trends.

Because of this, your solutions should follow a hybrid model. Storing all your important data and programs in a single location (whether onsite or not) can create vulnerabilities in your disaster recovery strategy.

Cloud-based solutions like those offered at IMS can help diversify your data and create more avenues from which to recover, should your credit union start 2023 with an unexpected breach or data loss attempt.

For some great resources on disaster recovery, check out the Disaster Recovery Journal’s recent article, “Are People Top of Mind in Your 2023 Business Continuity Strategy?”

Need Help with Your Disaster Recovery Plan?

To help address your disaster recovery concerns and set you on the right track to tackle any 2023 cybersecurity trends, our team at IMS wants to offer you an all-inclusive backup service with disaster recovery, too!

Just like your credit union’s main goal is to educate and serve your members, IMS is here to support credit unions with unique and tailored solutions that fit into your CU’s operations. We don’t send you solutions that you have to adjust your credit union network and IT operations for, we are all about filling IT and cybersecurity gaps for CUs large and small.

It’s time someone helped take care of you – reach out to IMS today and let us know how we can help!