With the imminent threat of re-imposing sanctions on Iran, Ford School alumnus William G. Rich (MPP '09) says U.S. banks should buckle down on security—cybersecurity, that is. In his October 25, 2018, op-ed for Bloomberg, Rich details the danger potential backlash from Iran poses to U.S. financial institutions. Technology has made hacking into a bank’s computer system effective and hard to detect, but Rich advises that technology can also do the heavy lifting for preventing such attempts in the first place.
The hit U.S. sanctions pose to Iran’s already struggling economy coupled with the country’s recent history of financial attacks on U.S. institutions forebode retaliation, and the country likely won’t act alone, he warns in “Iran is a Threat to the Banking System.” “Given the scale of its hard currency needs,” Rich writes, “Iran might seek help from other capable countries or criminal groups in conducting new attacks to evade sanctions.” This help will most likely, and most effectively, come in the form of cyber-enabled money laundering. But, Rich assures, banks investment in preventative technologies is the future, both in software that can help record data and make it harder to manipulate, and in minimizing the amount of hardware used, which by nature is harder to secure.
The impact such attacks could pose reverberate outside financial institutions, but it’s on them to take the necessary steps. Rich sees solutions, but warns that “financial institutions need to act now to protect themselves, their customers and their countries.”
William G. Rich is an international affairs fellow at the Council on Foreign Relations and adjunct research scholar at the School of International and Public Affairs (SIPA) at Columbia University. He previously served as U.S. Treasury attache to the United Arab Emirates and Oman. He received both his bachelor’s and master’s degrees from the University of Michigan, with his Masters in Public Policy from the Gerald R. Ford School of Public Policy.