Financial advice firms have told Adviser Ratings they are planning to increase their compliance spend by almost a third, including cyber security to reflect a greater understanding of digital risk.
Last week, lnsignia Financial experienced a cyber attack on its Expand platform which affected its superannuation members.
It described the incident as conducted by a “malicious third-party” which involved “credential stuffing” where an unusual number of login attempts targeted the platform, affecting around 100 Expand accounts.
As a result of the increased regulatory scrutiny on cyber and digital practices, early data from Adviser Ratings’ Landscape Report found advisers are increasing investment in material compliance enhancements – including cyber security – by a substantial 31 per cent.
This includes strengthening existing systems, enhancing staff training, developing and testing incident response plans and appropriate cyber insurance coverage.
Research by Numerisk found the average cost of a cyber insurance claim for a financial services organisation is $225,000, with business email compromise accounting for almost half of claims (47 per cent) followed by…
