Officials Worry About Safety of Financial Data

US intelligence officials are giving us one more reason to worry about the state of the financial market, as they say computer hackers could infiltrate banks and large financial institutions and send markets into yet another panicked frenzy.

In an article on the Government Executive website, Shane Harris says “senior counterintelligence and security officials laid out some dire scenarios. They're all predicated on a determined individual or small group fabricating information in such a way that the public sees a different picture of financial health than exists, either at a particular company or in broad markets.”

Harris says hackers intentionally feeding the market bad information could cause panic. “Let’s say instead of bringing down the systems at the New York Stock Exchange, you were able to corrupt the data in the exchange’s system,” Joel Brenner, the government’s top counterintelligence officer, told Harris. “If that happened, the market would lose confidence in the prices. ‘Gee, I thought I bought a million shares at X, not X plus 10 cents.’ What would happen to trading? The clearing mechanism would grind to a halt at the end of the day.”

And, while Harris says Brenner stressed that the security on stock exchanges is “very, very good,” Brenner and other senior officials say the financial system as a whole is not sufficiently protected. The economic damages from massive fraud, they note, could exceed those caused by an act of terrorism.

To read the full article, click here:  http://www.govexec.com/story_page.cfm?articleid=41217&dcn=todaysnews