Tuesday, 27 September 2016

FCA IT Outage a Bit of Irony

A bit of irony struck this past weekend when the Financial Conduct Authority (FCA) was forced to announce late last Friday that an incident at one of their outsourced data centres caused a widespread outage that affected a number of the watchdog's IT services. The FCA described the outage as 'major' even as it was working with their vendor to restore inaccessible services.

The irony of the outage is related to comments made earlier in the week by FCA specialist supervision team director Nausicaa Delfas, who berated private sector companies for not having appropriate systems in place to prevent cyber-attacks and network failures. At a cyber security conference last Wednesday, Delfas made it clear that the FCA wants the companies it regulates to do better.

"Most attacks you have read about were caused by basic failings – you can trace the majority back to: poor perimeter defences, un-patched, or end-of-life systems, or just a plain lack of security awareness within an organisation," Delfas said. "So we strongly encourage firms to evolve and instil within them a holistic 'security culture' – covering not just technology, but people and processes too."

Confirmed Hardware Failure

In the FCA's defence, the incident was not the result of any sort of cyber-attack or internal systems shortcoming. It was a direct consequence of a hardware failure as confirmed by Fujitsu, the vendor responsible for the data centre in question. Nonetheless, having not restored all systems several days into the incident demonstrates to the FCA just how difficult it can be to maintain networks when things like this happen.

The FCA has long argued that the companies they regulate should be prepared for any sort of incident that could knock out network access for any length of time. To show just how serious they are, regulators fined the Royal Bank of Scotland a record £56 million after an IT failure in 2014 left millions of customers without access to their accounts. That has some critics of the agency ready to speak out against the regulator.

ACI Worldwide's Paul Thomalla is among those executives calling out the City watchdog. He told the Financial Times that the watchdog has to be held to the same standards they apply to the financial sector. He said that if the FCA expects the institutions it regulates to maintain high standards of security and network reliability they need to implement the same standards for themselves.

Only time will tell how devastating the weekend incident really turns out to be and if there is any long-term fallout at all. The lesson to be learned is that there is no such thing as a 100% safe and reliable network. Things can happen even with the best of intentions and rock solid contingency plans in place. Our job is to do the best we can to mitigate the adverse effects of those incidents. When they happen, we just have to do all we can to get things fixed as quickly as possible.

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