Financial Crime World

Australian Financial Institutions Face Stringent Security Measures to Protect Critical Infrastructure Assets

In the wake of growing concerns over cyber threats, Australia’s financial services and markets sector is subject to a range of legal obligations aimed at safeguarding critical infrastructure assets. The Security of Critical Infrastructure Act 2018 (SOCI Act) outlines the responsibilities of owners, operators, and those with direct interests in these vital assets.

Regulatory Obligations

Responsible entities across the sector must adhere to specific regulations, including:

  • Notifying third-party data storage or processing providers that they are handling business-critical data for critical infrastructure assets
  • Implementing Enhanced Cyber Security Obligations (ECSO) to prevent and respond to cyber threats
  • Providing government assistance in responding to incidents that pose a significant risk to Australia’s prosperity, national security, or defence

Types of Critical Infrastructure Assets

The financial services and markets sector encompasses a broad range of stakeholders, including:

  • Banks
  • Superannuation funds
  • Insurance companies
  • Life insurers
  • Health insurers
  • Financial markets
  • Clearing and settlement facilities
  • Derivative trade repositories
  • Financial benchmarks
  • Payment systems
  • Credit facilities

There are four types of critical infrastructure assets considered vital to the sector:

  • Critical banking assets
  • Critical superannuation assets
  • Critical insurance assets
  • Critical financial market infrastructure assets

Each of these asset classes is subject to specific regulatory requirements designed to mitigate the risk of cyber attacks and ensure the continued functioning of Australia’s financial system.

Impact of SOCI Act

The SOCI Act represents a significant step forward in protecting Australia’s critical infrastructure from the ever-evolving threat of cyber attacks. By imposing stringent security measures on financial institutions, the government aims to:

  • Safeguard the country’s economic stability
  • Protect national security