Category: Financial

The rise of technology over the last decade has exacerbated this issue as each new or updated technology solution brings with it a new set of risks. This is the nature of technology as it serves an ever-fluid existence of rapidly maturing software and hardware remedies to challenging business requirements. The speed that both new products appear and new enhancements to existing products are applied make evaluating and monitoring technology risk a daunting task.

For example, the Sarbanes-Oxley Act is only a year old yet already dozens of manufacturers have released software products to help bank management comply with it. All of these products were also developed with expediency to capitalize on the new market the act instantly created. How about security, was there time to incorporate an active security plan within the development process?

This is why technology partners need to be just that, partners.

Banks just have to remain continually mindful that the current market rewards those third parties who react the fastest, not necessarily the best. Bank managers must also remind themselves that, under current law, outsourcing to vendors does not transfer the bank’s responsibility to satisfy regulations.

As more vendors become savvy to the implications of newer regulations, we are witnessing more of them add clauses and addendum’s in the contract to either limit accountability or sidestep participation altogether.

Today, contracts with vendors must be specific about the bank’s regulatory obligations, they can no longer be left unmentioned or implied.

More info: [url=http://www.bankinfosecurity.com/?q=node/view/461]http://www.bankinfosecurity.com/?q=node/view/461[/url]

The award will go towards providing its industry members with secure collaboration, additional data feeds regarding threats and vulnerabilities, alert confirmation, new analytical capabilities, and performance metrics.

“Our research convinced us that the FS/ISAC must make significant investments to upgrade its technological infrastructure if it is to serve the entire sector and deliver a product that would elicit ongoing, private-sector support,” remarked Brian Roseboro, Acting Under Secretary of the Treasury for Domestic Finance.

The FSSCC’s membership consists of trade associations, institutes and utilities in the banking world, rather than the individual banks themselves.

Acting on their members’ behalf, the FSSCC representatives will help to coordinate sector-wide initiatives in specific market segments within financial services.

The FSSCC may also prove to be a important conduit for coordinating comments on statutes published for comment by the Department of Homeland Security, taking a broad, industry-wide perspective.

More info: [url=http://www.bankinfosecurity.com/feed.php?target=http://www.banktech.com/story/news/showArticle.jhtml?articleID=17200386]http://www.bankinfosecurity.com/feed.php?target=http://www.banktech.com/story/news/showArticle.jhtml?articleID=17200386[/url]

Most will be outsourced to India, with South Africa also under consideration, according to media reports. The Evening Standard, a British daily, reported this week that part of Barclays call center operations would go offshore, with up to 5,000 jobs eventually involved.

However, a Barclays representative denied the report Wednesday and said there were no pans for outsourcing at present. The representative declined to comment on future plans, saying instead that the industry was looking into offshoring and that it was a complex issue. Barclays has said it was in talks with the U.K. banking union, Unifi, about international outsourcing. Barclays recently set up operations in India with 500 staff.

More and more British companies are turning to outsourcing, although at a slower reported rate than American companies. Recent reports have estimated that less than 15 percent of leading British companies have started outsourcing activities, compared with 35 percent of their American counterparts. It is estimated that the United Kingdom has lost as many as 50,000 jobs to Indian outsourcing in the last two years.

Security and unemployment fears have been voiced, and the British government has ordered an independent study of the effects of outsourcing. The study begins in January and will last about three months.

More info: [url=http://www.eveningstandard.co.uk/news/business/articles/timid72320]http://www.eveningstandard.co.uk/news/business/articles/timid72320[/url]

According to Jupiter Research, the number of online banking households will grow at a compound annual growth rate of 14 percent to 56 million over the next five years.

The reason for the jump is simple — more households will connect to the Internet. Once the purview of well-heeled consumers, online banking will see its strongest growth from lower and middle class households (defined in this study as those with income of $75,000 or less), which will use bank Web sites to manage credit cards and auto loans, Jupiter Research says.

Jupiter Research analysts say online banking has more to do with consumers’ choice of channel (the Internet, rather than the teller or telephone) than differences between rival banks offerings.

The report states “only possible threat” to increasing online bank usage is a security breach and concludes, “Security concerns are already a primary inhibitor of initial consumer adoption; if realized, they will be a serious drier of online attrition.”

More info: [url=http://www.internetnews.com/fina-news/article.php/3292001]http://www.internetnews.com/fina-news/article.php/3292001[/url]

The survey – conducted among 41 financial institution representatives at a Sun client conference organised by Finextra sister company 660 Degrees – found that 83% of respondents believe investment in compliance technology will be higher in 2004 than in 2003.

Of those surveyed, 64% cite compliance with legislation such as Basel II and Sarbanes-Oxley as ‘very important’ and 26% as ‘important’. Over half (55%) of firms describe compliance as a “distraction” from their core business in 2004 as they take steps to meet legal requirements.

Under Basel II, banks will be required to set aside capital to cover contingencies relating to operational risk. The final rules, which come into effect in 2007, will require banks to have collected and aggregated three years’ worth of data in order to effectively monitor and analyse risk under internal programmes.

Sarbanes-Oxley legislation requires chairpersons and chief financial officers to submit documents attesting to the accuracy and soundness of financial reports.

Martin Brown, UK head of finance, Sun Microsystems, says because of this regulation, sophisticated data mining tools, archival and retrieval systems and security software are now top of many firm’s priority lists. “2004 will be a defining year for regulation in the financial services industry. Not only is Sarbanes-Oxley coming into force, but in order to meet Basel II in 2007 financial institutions need to put the building blocks in place now,” he adds. Brown says that the Basel II and Sarbanes-Oxley are encouraging good business practice: “A firm should know what its exposure is and be able to base decisions on a complete set of historical data.”

More info: [url=http://www.finextra.com/fullstory.asp?id=10795]http://www.finextra.com/fullstory.asp?id=10795[/url]