Financial Services companies in the U.K. aren’t doing a good job keeping their IT systems up and running, with the Financial Conduct Authority (FCA) announcing financial services firms reported a 138 percent increase in tech outages during 2018.
According to a report in the Financial Times, citing the FCA, there was an 18 percent rise in cyber attacks in the year to October, although the FCA thinks there is a lot of under-reporting going on, which would make the numbers conservative.
“We should remember that this is the first year where the total number of debit card transactions has outstripped cash transactions,” Megan Butler, the FCA’s executive director for wholesale and specialist supervision, said during a speech in London, reported Reuters. “So you won’t be surprised to hear me say that the FCA is deeply concerned that the number of technology incidents reported to us has increased, with many outages linked to re-platforming and outsourcing failures. The most prominent of these is perhaps TSB’s IT migration earlier this year. But we’ve also seen a lot of recent outages caused by relatively small changes, usually made on a weekday evening.”
The data came from the FCA’s technology and cyber resilience survey in which the government watchdog interviewed 300 financial services firms. The Financial Times noted the survey also found that one-third of firms don’t engage in regular cyber assessments while close to half don’t upgrade or retire older technology in a proper time frame. Butler said wholesale markets, retail investments, and retail lending are all industries that are particularly behind.
The latest data from the FCA comes at a time when lawmakers and consumers are angry about technology outages at financial services providers. Earlier this month the Treasury Select committee started an investigation into the issue after a year of several outages including at the TSB, Barclays and Visa, noted the Financial Times. As of December banks have to tell the FCA and Bank Of England how they are better preparing for outages. If there is poor planning senior executives within the firm could be on the hook, noted the report.