Thursday, June 16, 2011

Dangers of the IMF Cyberattack...

Over the weekend, the International Monetary Fund (IMF) was the victim of a serious cyberattack. Experts are now claiming that the attack was so sophisticated and narrowly targeted that it must have been launched, not by a rogue group of hackers, but by the government of a nation-state.

Most people aren't very familiar with the IMF, so here's why this matters... The IMF manages financial crises around the world and is the repository of highly confidential information about the fiscal condition of many nations. As described in the New York Times, "because the fund has been at the center of economic bailout programs for Portugal, Greece and Ireland — and possesses sensitive data on other countries that may be on the brink of crisis — its database contains potentially market-moving information".

One official called it "political dynamite".

Experts are saying that the intruders' goal had been to install software that would give a nation-state a "digital insider presence" on the IMF network. "Such a presence could yield a trove of non-public economic data used by the fund to promote exchange rate stability, support balanced international trade and provide resources to remedy members' balance-of-payments crises".

At a time when the global financial markets swing wildly anytime news breaks about Greece or other countries' possible default on its debts, such information could wreak havoc on the stability of the Western World.

It's an anarchist's dream.

Right now, Leon Panetta is testifying before Congress and has to answer what he would do as Defense Secretary to prevent future catastrophic cyberattacks - the frequency of which, by militant nation-states, is increasingly on the rise. Any plan must include strategies of both 1) prevention and 2) response.

No one with any credibility in the field believes that cyberattacks can be 100% prevented. Nevertheless, efforts must be made as best as they can, and, at the very least, the effects of a mass cyberattack must be mitigated.

As a final point, officials have thus far been extremely secretive about what type of damage was actually done. Sometimes, particularly as it affects global markets, that uncertainty stokes the flames even worse.