What Is Hacking and How Does It Affect Banks and Financial Institutions?
Hacking is a malicious activity that involves breaking into digital devices, computer systems and computer networks without the owner’s permission. Using vulnerabilities in software or hardware, hackers steal information, cause damage and manipulate systems. Hacking is a growing threat to businesses of all sizes, including banks and financial institutions. Hackers pose a variety of threats to financial security, including financial loss, reputational damage and regulatory non-compliance.
Black hat hackers are the bad guys, seeking to exploit vulnerabilities in computer systems and software for financial gain or other nefarious purposes. They can use this data to target and manipulate individuals, companies, and governments. Examples of black hat hacking include malware, phishing and ransomware attacks. They can also create botnets, which are collections of hijacked computers around the world, to attack servers with massive amounts of invalid requests – known as a denial of service (DoS or DDoS) attack.
White hat hackers (also called ethical hackers) perform penetration testing to test system vulnerabilities for the benefit of improving security for all users. They may share their findings with companies who can then fix them, earning them a fee or a job in return.
Other hackers hack for fun, to challenge themselves or to prove their skill by breaching difficult targets. They may post their exploits on social media to attract attention and recognition. Consumers can protect themselves from hackers by making sure they don’t click on links or open attachments in emails or texts that look suspicious, and keeping software up to date to avoid the latest known vulnerabilities that hackers love to exploit.