Battle against cybercrime all about prevention

The rise in cyberattacks means lenders and aggregators are investing in the best systems and processes to protect their operations as well as the security of their clients’ and partners’ data

NO BUSINESS in 2023 can afford to be complacent about cybersecurity. Online scams and cyberattacks pose a growing financial threat to individual Australians and businesses both big and small. Almost every day there’s a new report in the media about companies and even government departments being hacked. Among those to have suffered recent data breaches are Medibank, Optus, Woolworths, Latitude, the Australian Federal Police and the Department of Home Affairs. Recent research from NAB Group Economics found that three in 10 businesses have experienced a data breach or cybercrime, with average losses of almost $20,000. The Australian Bureau of Statistics reported in June that during the 2021/22 financial year, the types of cyberattacks businesses experienced included scams or fraud (16%), malicious software infecting computers (5%), and unauthorised access or use (3%).

Bowles says cybercrime is having an increasingly devastating impact on the Australian community, with over 1,100 cybersecurity incidents reported to the Australian Cyber Security Centre last year, equating to about 21 reports per week. “We know this is a growing problem in Australia, with small business owners being the most targeted group by cybercriminals,” she says. “This is adding to the pressure small business owners are already under as they face continued cost pressures, a labour skills shortage, and rising inflation.” NAB’s focus is on having world-class cybersecurity and fraud protections in place “to protect our customers’ information and money, as well as our corporate information,” Bowles says.

The bank runs an NAB Security Hub (at nab.com.au/security), which received more than 2.2 million views this year, she says. NAB also conducts a customer webinar series, and over 100 sessions have already been completed, reaching 6,500 customers. “Since October 2022, we’ve run a comprehensive security awareness campaign via email to personal bank and business bank customers, containing cybersecurity and scam education.” Bowles says that as business owners, brokers are responsible for a substantial amount of data and personal information – both their own and that of their customers. “Along with action, ongoing education is the best defence against bad actors,” she says. “We want to help people highlight the moments when split-second decisions are made, which, as our research shows, can have devastating financial and emotional consequences.”

Around 3 in 10 Australian SMEs have experienced a cyberattack or data breach during the life of their business

According to NAB’s Cyber Security Insights April 2023 report

“We are also focused on helping our customers learn to protect themselves from the common cyberthreats and scams. In FY22 we invested just under $1.4 billion back into the bank, with 55% of that spend going towards improving our financial crime detection and cybersecurity capabilities.” Buchanan says the team at broker aggregator SFG works in an environment that deals with some of consumers’ most private and financial information, requiring the highest standards of security and care. “Our systems are audited both internally and externally to achieve bank-grade security for our brokers and their clients,” he says. “Our IT consultants and teams report on many thousands of attempts on various sites within our industry on a weekly basis, and so data security is at the top of the list in terms of importance and focus for SFG.” Buchanan points out that, historically, human error is responsible for more breaches than, for example, hacking or phishing. “There has always been a focus on good data management, but this has been heightened due to the recent Optus, Latitude and other hacks,” he says. “Our message to our network includes secure systems, periodic reviews, training and testing.”

Compliance, risks, and data security are woven into all of SFG’s educational events, Buchanan says, and this is designed to continually push the message of good practices in systems and behaviours. “We also assist by auditing sites, systems and processes for our members, combined with providing the most secure systems and storage available in our market.” Bowles says ransomware, scams and phishing continue to dominate when it comes to the most common threats facing Australians. “Investment scams and invoice scams continue to be very common, with the latter involving a person or business receiving an invoice or email which has been altered to contain a bank account controlled by a scammer,” she says. “Investment scams can appear to be highly sophisticated and often involve slick marketing material offering high returns for seemingly low-risk investments.” NAB has a crucial role to play in helping customers to bank as safely as possible. “We have a mature cybersecurity and scams education program in place for personal and business bank customers as well as the Australian public,” Bowles says.

SFGconnect has all the tools that brokers need built into the system, Buchanan says. “This means that brokers don’t need to leave the system to run property reports, bank-scraping tools, credit checks or marketing. By having everything built in, it reduces keystroke errors or data errors.” Having the customer and referrer portals originate from within the system ensures not only heightened security but a smooth and wonderful experience for brokers and their customers alike, Buchanan says. “Multi-factor authentication coupled with SOC2 Type 2 accreditation and bank-grade security storage [AWS] gives customers a huge deal of comfort when working with a broker using SFGconnect. “Brokers should be doing what they can to ensure that they have the highest levels of protection, and by using the most secure system available to brokers [SFGconnect], we have already done a big part of their security work for them.”

“Multi-factor authentication coupled with SOC2 Type 2 accreditation and bank-grade security storage [AWS] gives customers a huge deal of comfort when working with a broker using SFGconnect”

Blake Buchanan, SFG

Computer keyboard and padlock on dark background. Cybercrime prevention.

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According to the Australian Cyber Security Centre’s Annual Cyber Threat Report July 2021 to June 2022, the average cost per cybercrime reported during that period rose 14% to over $39,000 for small business, $88,000 for medium business, and more than $62,000 for large business. Cybersecurity is of vital importance to the financial services industry, with lenders, aggregators and brokerages relying on robust systems and processes to mitigate threats and ensure the integrity of critical data. In this sector focus, MPA spoke to Tessa Bowles, manager, security advisory and awareness at NAB, and Blake Buchanan, general manager of Specialist Finance Group, to hear their thoughts on cybercrime and how their companies are responding.

Buchanan says AI can be used in various ways to improve security, yet AI can also be used to breach systems and obtain unauthorised information. “As the threats become more sophisticated, so do defences, and whilst I have no doubt AI will assist in this area, it’s still very early days for this space, and it’s something that we will continue to monitor,” he says. “For SFG, our goal is always to be two steps in front and give comfort to our brokers and their clients with our security certifications, multi-factor authentication and all-in-one system.” At NAB, Bowles says the bank is already using some AI tools in cybersecurity, fraud and financial crime. “Although AI has been around for many years, we’re at a real inflection point with the explosion of GenAI tools,” she says. “Our teams continue to explore the uses and benefits of GenAI for customers and colleagues, particularly how AI technology can help keep the bank and our customers and colleagues safe.”

“Brokers can stay informed about the different cyberthreats impacting businesses via the NAB Security Hub; the latest fraud alerts service on the NAB website; and through free monthly security webinars for businesses and customers”

Tessa Bowles, NAB

Industry experts

Blake Buchanan

SFG

Tessa Bowles

NAB

Industry experts

Tessa Bowles is a certified security awareness professional and a senior consultant in NAB’s Group Security Advisory and Awareness team. Bowles has been involved in the finance industry for the last 12 years. She has experience in operational roles and has specialised in learning capability and security awareness uplift for the past seven years. Prior to joining banking, Bowles enjoyed a career in the hospitality and tourism industries. She is passionate about educating and empowering NAB colleagues, customers, businesses and the community with the life skills they need to ensure they know how to stay safe online – a must in today’s world.

NAB

Tessa Bowles

Blake Buchanan, general manager at SFG, is an expert in the broker channel with some 20 years’ experience in the finance industry, specialising in broking, lending and aggregation. Buchanan is known for his expertise and passion for the broker channel, along with his ability to deliver strong distribution results through systems, people, processes and partnerships.

SFG

Blake Buchanan

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Heritage Bank

Stewart Saunders

MFAA head credit adviser, Finsure Finance and Insurance

Christopher Lee

Blake Buchanan

SFG

Tessa Bowles

NAB

Industry experts

NAB

Tessa Bowles

SFG

Blake Buchanan

Heritage Bank

Stewart Saunders

MFAA head credit adviser, Finsure Finance and Insurance

Christopher Lee

Cyber threats – and the strategies to deal with them

Tessa Bowles

NAB

Blake Buchanan

SFG

Stewart Saunders

Heritage Bank

Christopher Lee

MFAA head credit adviser, Finsure Finance and Insurance

Mark HarChristopher Leeon

Heritage Bank

Stewart Saunders

SFG

Blake Buchanan

NAB

Tessa Bowles

New cybersecurity features

Published 23 Oct 2023

NAB Broker Distribution is dedicated to helping brokers deliver the best customer outcomes, supported by a national network of experienced BDMs and dedicated support through every stage of a customer’s home lending experience. As the ‘Bank Behind the Broker,’ NAB will continue to invest in the broker channel and uncover the next innovation to make things simpler and easier for its broker partners and customers.

Find out more

Specialist Finance Group is a family-owned business that’s been serving the broking community for more than 30 years. With a customer-centric model, SFG provides its members with the best possible systems, services and support to assist them in growing and improving their businesses. SFG’s unique model has seen rapid expansion in recent years and has consistently delivered results well above system.

Find out more

Just over 1 in 10 experienced a cyberattack or data breach in the previous 12 months alone

Attacks were most common in Queensland (14% of SMEs) and least common in Tasmania (8%) and NSW (9%) over the past year

SMEs estimated they had lost around $19,400, on average, because of cyberattacks in the past year

Source: NAB Cyber Security Insights, April 2023

Financial losses due to business email compromise increased to over $98m – an average loss of $64,000 per cybercrime report

Source: Australian Cyber Security Centre Annual Cyber Threat Report, July 2021 to June 2022

The Australian Cyber Security Centre’s Annual Cyber Threat Report shows that in FY22:

Rising threat of cybercrime in Australia

Average cost per cybercrime report rose to over $39,000 for small businesses, $88,000 for medium businesses, and over $62,000 for large businesses – a 14% increase

Number of cybercrime reports rose by 13% to over 76,000+

Publicly reported software vulnerabilities increased by 25%

A cybercrime is reported every 7 minutes on average

Bowles says NAB is continuing to work with and educate its broking partners on the current cybersecurity and scam threats, offering a number of tailored workshops each year run by NAB’s dedicated Advisory & Awareness team. She says brokers can stay informed about the different cyberthreats impacting businesses via the bank’s Security Hub, the latest fraud alerts service on the NAB website, and through free monthly security webinars for businesses and customers. “We also offer free online security webinars for personal and business customers as well as the community. The one-hour session covers the latest scams and cybersecurity trends and advice on how to protect yourself.”

Keeping sensitive information safe

In a major effort to reduce the impact of scams and fraud – and in an Australian banking first – NAB stopped the use of links in unexpected text messages to customers, Bowles says. “We saw this initiative have an immediate impact, with a 29% reduction in reports of NAB-branded spoofing scams between January and May this year.” Similarly, she says the introduction of real-time payment prompts in the NAB app to protect customers from suspected scam payments enabled customers to stop $270 million worth of payments between March and July.

Buchanan says that unfortunately it’s the nature of “our industry that you never cease adjusting or implementing new processes or systems as scammers and schemes become more sophisticated. “Recently, we announced that multi-factor logins inclusive of SMS codes will be mandated for an even greater level of protection. We say good compliance and good security is good business, as without both you won’t have a business.”

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