Cybercrime could be 'next black swan event': ASIC chief

Medcraft warns of 'systemic risk'

Australian Securities and Investment Commission chairperson Greg Medcraft has used the ASIC Annual Forum to issue a warning about the potential for poor information security to destabilise financial markets.

"Cybercrime is a systemic risk and I think it is the next black swan event," Medcraft said in remarks prepared for the conference.

"Cyber-resilience" — along with mitigating the risk of financialisation of markets, maintaining good governance and the facilitation of market-based financing — is necessary for fair and stable financial markets, according to the ASIC head.

"Advances in technology have led to the rise of cybercrime around the world," Medcraft said.

"The links between market players and infrastructure mean that the impact of a cyber-attack can spread quickly and has the potential to dangerously affect the integrity and efficiency of global markets, the protection of investors, and, ultimately, trust and confidence in the financial system"

"Cyber-resilience through risk management is vital," Medcraft said

"For organisations, risk managements systems must be granular enough to ensure a good level of resilience in an organisation."

The International Organization of Securities Commissions (IOSCO) is looking to develop a global standard on risk management for cyber-crime, the ASIC chief added.

He also noted that last month the US government released its Cybersecurity Framework which can help organisations manage risks to information security.