Wall Street firms are preparing to battle a growing menace: cyberattacks.
The Securities Industry and Financial Markets Association, a major financial industry group, will coordinate a July 18 simulated cyber attack with about 50 firms in an exercise called Quantum Dawn 2. Exchanges, the U.S. Treasury and the Department of Homeland Security will also participate in the exercise, a sequel to a 2011 simulation.
“We’ve been under attack as a sector for the last nine months,” said Karl Schimmeck, the trade group’s vice president of financial services operations. “We know this is real. We know things are possible.”
The financial industry has weathered its share of such attacks in recent months as U.S. officials have become increasingly alarmed over computer-launched onslaughts by other nations, terrorists and hackers. Top military and intelligence officials have said the cyber threat now outranks al-Qaida.
Schimmeck said little about the type of barrage the participating firms would face, but it appears to be more significant in scope than the denial-of-service attacks major banks recently have endured. In those assaults, hackers bombarded banks’ websites with so many requests the sites slowed or stopped working.
He said firms would get hit with multiple simulated attacks, and he indicated the fallout would affect the broader financial markets.
“It would be a pretty major news item,” Schimmeck said. “We’re testing it as a sector-wide incident with systemic implications.”
The trade group will oversee the simulation from its offices in Manhattan’s financial district. The exercise was rescheduled from last week so more firms could participate.
After the exercise, participants will be able to assess their responses and hone their defenses.
“This is part of the game of staying ahead of your adversary,” Schimmeck said.