JP Morgan "Annual Technology Investment of 20 Trillion Won"
Increased Attacks Targeting Western Financial Institutions After the Ukraine-Russia War
Since the outbreak of the war between Ukraine and Russia in 2022, attempts at cyberattacks targeting Western financial institutions have surged.
On the 17th (local time), according to Bloomberg, Mary Erdoes, CEO of JP Morgan Chase Asset & Asset Management, stated at the World Economic Forum (WEF, Davos Forum) held in Davos, Switzerland, that JP Morgan invests $15 billion (about 20 trillion KRW) annually in technology and employs 62,000 technology experts.
Mary Erdoes, CEO of Assets and Asset Management at JPMorgan Chase [Image source=Reuters Yonhap News]
This figure surpasses that of big tech companies, with the majority of the technical workforce dedicated to responding to cybercrime. CEO Erdoes said, "JP Morgan employs more engineers than Google or Amazon," adding, "(Defending against cyberattacks) will become increasingly difficult."
Erdoes also revealed, "JP Morgan faces 45 billion hacking attempts daily." However, JP Morgan clarified that this monitoring figure includes not only hacking attacks but also benign activities such as virtual desktop logins.
This is not an issue unique to JP Morgan, the world's largest investment bank. Recently, cyberattacks targeting financial institutions have surged. In particular, the increase in attacks by Russian hackers on Western banks since Russia's invasion of Ukraine in February 2022 is considered a significant factor. This is due to sanctions imposed on Russian financial institutions. Additionally, the use of artificial intelligence (AI) in cybercrime has led to an increase in attacks, which have become more sophisticated.
According to cybersecurity firm Sophos, ransomware attacks in the financial sector surged by 64% last year. Compared to 2021, this is nearly double. Furthermore, in a survey conducted by KPMG last year targeting bank CEOs, 71% of respondents expressed concern about cybercrime. However, only 54% said they were well-prepared to defend against cyberattacks.
In November last year, the Industrial and Commercial Bank of China (ICBC) New York branch was attacked, causing a halt in $25 trillion worth of U.S. Treasury market transactions. Although there was no operational impact, in 2022 Russian hackers attacked the JP Morgan website. About a decade ago, JP Morgan also suffered one of the largest cyberattacks in history, affecting 83 million accounts, including 76 million households and 7 million businesses.
At the Davos Forum, IMF Deputy Managing Director Gita Gopinath also expressed policymakers' concerns about cybercrime using AI. Deputy Managing Director Gopinath said, "There is a risk of a major incident occurring before we actually find ways to solve the problem."
She also conveyed that the IMF is particularly concerned about the long-term risks AI poses to financial markets. Deputy Managing Director Gopinath stated, "If all major banks use AI technology developed by three to four companies, AI could exhibit strong herd behavior," adding, "This would amplify the swings of financial cycles, repeating massive credit booms and busts."
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