{"id":17163,"date":"2016-11-18T17:06:35","date_gmt":"2016-11-18T22:06:35","guid":{"rendered":"https:\/\/digital.hbs.edu\/platform-rctom\/submission\/citibank-defending-against-cyber-threats\/"},"modified":"2016-11-18T17:16:31","modified_gmt":"2016-11-18T22:16:31","slug":"citibank-protecting-against-cyber-threats","status":"publish","type":"hck-submission","link":"https:\/\/d3.harvard.edu\/platform-rctom\/submission\/citibank-protecting-against-cyber-threats\/","title":{"rendered":"Citibank: Protecting Against Cyber Threats"},"content":{"rendered":"

Digital technology has crept into nearly every aspect of society, offering unprecedented access to information and services while also creating massive cyber security challenges that leave many of the most personal and most important aspects of our lives vulnerable to cyber attack.\u00a0 In an age where digitalization and interconnectivity has been introduced into everything from everyday items such as watches to thermostats through the \u201cInternet of Things\u201d to the most important elements of our national infrastructure, including financial institutions and electrical power grids, it is imperative for the private and public sectors to take action and protect the underlying structure of our society.<\/p>\n

Over the last decade, we have seen several examples of the vulnerabilities in an increasingly digitalized world such as the 2007 coordinated cyber attacks on Estonia1<\/sup>, the 2014 hack of Sony Pictures2<\/sup>, and the 2015 attack that disabled a regional power grid in Ukraine.3<\/sup> \u00a0Cyber crime alone is estimated to cost businesses $400 billion per year and British insurance company Lloyd\u2019s estimates that amount to quadruple to $2 trillion by 2019,4<\/sup> and businesses are taking notice.\u00a0 For example, IBM\u2019s CEO, Ginni Rometty stated last year that \u201ccyber crime is the greatest threat to every company in the world.\u201d5<\/sup>\u00a0 In this environment, Citibank is taking action to mitigate cyber threats.<\/p>\n

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New Business Model, Vulnerabilities Exposed<\/strong><\/p>\n

Like others, Citibank has increasingly migrated services onto digital platforms for efficiency, speed, and customer convenience.\u00a0 This represents a massive shift in the business model which originally relied heavily on personnel and infrastructure.\u00a0 Now, instead of depending on methods like writing physical checks or visiting a teller, customers have 24\/7 access to account information from virtually anywhere and access to services electronically.<\/p>\n

However, that transition has not been without challenges.\u00a0 For example, in 2011, Citibank was hacked and \u201cthe financial data of more than 360,000\u201d credit card holders was exposed.6<\/sup>\u00a0 A month later, Citibank revealed that \u201cabout $2.7 million was stolen\u201d from a portion of those accounts.7<\/sup> \u00a0The chart below shows the financial services industry has the second highest average annualized cost of cyber attacks demonstrating the scale and cost consequences of the threat.8<\/sup>\u00a0 Cyber attacks will continue to target the industry and Citibank needs to adapt its operating model to this challenge.<\/p>\n

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Innovation and Adaptation<\/strong><\/p>\n

Citibank has adapted its operating model to address the vulnerabilities of that digital transition to add protection and thus, value for customers that can trust the integrity of their bank.\u00a0 These measures include:<\/p>\n