Financial Crime World

Title: Hong Kong Financial Sector Braces for Record-Breaking Cybercrime Surge Amidst COVID-19 Pandemic

The Rising Cost of Cybercrime and COVID-19

  • The pandemic’s economic fallout and cybercrime share similar financial repercussions.
  • COVID-19 could result in up to US$5-US$6 trillion in lost global GDP.
  • Cybercrime is projected to cost around US$6 trillion internationally.

The Threat Landscape: Phishing, Ransomware, and Hacking Attacks

  • Cybercrime takes various forms, leading to data destruction, productivity loss, business disruption, fraud, financial theft, and intellectual property theft.
  • The financial sector is a top target, ranking among the five sectors with highest severity and frequency of attacks.

Cyber Threats in Hong Kong: A Rising Concern

  • Cybercrime cases in Hong Kong increased from 2,206 in 2011 to 12,916 in 2020.
  • The damages reached an alarming HK$2.96 billion in 2020 from mere HK$148 million in 2011.

Addressing Cybersecurity Challenges: Smart City Blueprint and Government Initiatives

  • The Smart City Blueprint acknowledges the importance of cyberspace safety.
  • The government aims to strengthen its cybersecurity capabilities and collaborate with stakeholders.

Room for Improvement: An Independent Commission or Cross-Bureau Working Group

  • Establishing an independent commission or a cross-bureau working group could help bolster Hong Kong’s defenses.

Fragmented Regulatory and Oversight Framework

  • Existing laws (Personal Data (Privacy) Ordinance, Unsolicited Electronic Messages Ordinance, Interception of Communications and Surveillance Ordinance, Official Secrets Ordinance, and various financial regulators’ codes of conduct) govern different aspects of cybersecurity.
  • A more comprehensive approach is necessary.

Strengthening Cybersecurity in Hong Kong: A Cyberspace Protection Ordinance and Collaborative Efforts

  • Introducing a Cyberspace Protection Ordinance would provide the necessary framework for maintaining Hong Kong as a secure financial hub.
  • Regulators should collaborate to build upon the HKMA’s framework and extend it into a comprehensive, sector-specific defense mechanism.

The Future of Cybersecurity

  • As the world recalibrates from the pandemic, the escalating costs of cybercrime should be recognized alongside efforts for pandemic relief and recovery.
  • Fortifying cybersecurity infrastructure will help defend against cyber threats and secure future prospects.

References

[Allianz]: https://www.allianz.com/en.html/press-releases/2021/03/allianz-risk-barometer-cyber-risks-dominate.html [Hong Kong Monetary Authority]: https://www.hkma.gov.hk/en/news-and-media/press-releases/2019/11/20191104-5.shtml [eGov Monitor]: https://www.egomonitor.com/e-government/hong-kong/security/ [IBM Security]: https://www.ibm.com/think/cost-of-cybercrime/2021-report/

*Image by Michael Gaida from Pixabay