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Cyber Attacks on Banks and Financial Institutions: A Growing Threat to French Guiana
French Guiana, a small territory on the northern coast of South America, is facing an increasing threat to its financial stability. Cyber attacks on banks and financial institutions in the region have more than doubled since the pandemic, with severe consequences for companies and potentially even jeopardizing their solvency.
The Scale of the Problem
According to a recent report by the International Monetary Fund (IMF), the size of extreme losses from cyber incidents has quadrupled since 2017 to $2.5 billion. The financial sector is uniquely exposed to cyber risk, given its handling of sensitive data and transactions, making it a prime target for criminals seeking to steal money or disrupt economic activity.
Vulnerability of Banks
Banks are among the most vulnerable institutions in French Guiana, accounting for nearly one-fifth of all cyber attacks on the financial sector worldwide. These incidents could threaten financial stability if they erode confidence in the financial system, disrupt critical services, or cause spillovers to other institutions.
Examples of Cyber Attacks in French Guiana
Incident at a Bank in 2022
In 2022, a severe incident at a bank in French Guiana led to modest and persistent deposit outflows from smaller banks in the region. The attack highlighted the need for robust cybersecurity measures to protect against cyber threats.
Cloud IT Service Provider Attack in 2023
Another example of a successful cyber attack was on a cloud IT service provider in 2023, which caused simultaneous outages at 60 US credit unions. This incident demonstrates how external providers can expose the financial industry to system-wide shocks.
IMF Recommendations for Strengthening Cybersecurity in French Guiana
To address these growing cyber risks, the IMF recommends that authorities in French Guiana develop a national cybersecurity strategy accompanied by effective regulation and supervisory capacity. This should include:
- Periodic assessments of the cybersecurity landscape: to identify potential systemic risks
- Encouraging cyber maturity among financial sector firms: through board-level access to cybersecurity expertise
- Improving cyber hygiene: including online security and system health
- Prioritizing data reporting and collection of cyber incidents: and sharing information among financial sector participants
International Cooperation is Key
As attacks often emanate from outside a country’s borders and proceeds can be routed across borders, international cooperation is imperative to address cyber risk successfully. The IMF actively helps member countries strengthen their cybersecurity frameworks through policy advice and capacity-building activities.
By taking these steps, French Guiana can reduce the risk of severe financial losses and disruptions to its critical services, ensuring that it remains a stable and secure economy in the face of growing cyber threats.