SWIFT Payment System Warns Clients of Hacking Attacks

SWIFT issued a warning to clients after authorities in Bangladesh and other countries conducted investigations related to the theft of $81 million from the account of the central bank of Bangladesh at the branch of the U.S. Federal Reserve in New York by computer hackers.

The global financial network SWIFT, used by banks for daily payment transactions, warned clients that it is aware of a series of computer incidents that have occurred recently, in which hackers sent unauthorized messages through its system.

This warning was issued to clients after authorities in Bangladesh and other countries conducted investigations related to the theft of $81 million from the account of the central bank of Bangladesh at the branch of the U.S. Federal Reserve in New York by computer hackers. SWIFT confirmed that the mentioned scheme involved modifications to the software of this global payment system on the computers of the central bank of Bangladesh to conceal evidence of unauthorized transfers.

SWIFT’s statement this week is the first confirmation that the attacks on the central bank of Bangladesh are not an isolated case, but one of several recent criminal schemes aimed at exploiting the advantages of the global messaging platform used by approximately 11,000 financial institutions.

SWIFT is aware of a number of recent computer incidents in which malicious attackers, either inside or outside the system, managed to send SWIFT messages from the offices of financial institutions, their computers, or terminals connected to their local interfaces on the SWIFT network, the group warned clients in a message that was reviewed by Reuters on Monday.

In the warning that SWIFT sent to clients via its network in a confidential notice, the victims were not named, nor was the value of losses from previously undisclosed attacks specified. SWIFT confirmed the authenticity of that notice to Reuters.

On Monday, SWIFT also announced a security enhancement to the software that banks use to access the network to prevent malware that, according to security experts at the British company BAA Systems, hackers likely used in the theft from the account of the central bank of Bangladesh. Evidence from the British company suggests that hackers manipulated SWIFT’s network access software, which banks use to connect to SWIFT’s messaging platform, to cover their tracks.

BAA Systems emphasizes that they cannot explain how unauthorized orders were created and pushed through the system. However, SWIFT provided banks with some evidence of how this occurred in its notice, adding that in most cases, the method of operation was similar. They state that attackers obtained valid credentials for operators authorized to create and approve SWIFT messages, and then sent unauthorized messages impersonating those individuals.

Cyberattack experts say that new attacks could occur while SWIFT banking clients check whether their access to SWIFT has been compromised. Shane Shook, a banking security consultant investigating large-scale financial crime, stated that hackers are turning to SWIFT and other private platforms for financial messaging because such attacks can generate higher revenues than targeting consumers or small businesses.

– “These hacking attacks specifically target financial institutions because less effort results in larger thefts. It is far more efficient than stealing from clients,” he said.