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Recently by Rich Bolstridge

As we begin a new year, it is worthwhile to look back at some of the events of 2011 - and project where some of the biggest challenges will lie ahead for us in 2012.  Security threats to the online world of financial services were perhaps the number one threat in 2011, and the risks will continue to build in 2012.

Akamai commissioned research by IDC Financial Insights to further understand these threats. The resulting whitepaper, titled 'New Threats Demand Innovative Responses,' exposes some of the challenges that IT departments and their business-side counterparts face in responding to these threats.  Some of the major recommendations include:

- IT security teams need to ensure that security strategies are reflective of business goals and strategic direction where the growth of the digital banking channel is concerned. This requires IT to be involved in the design and development of new products and services from the outset, particularly where newer interaction mechanisms - namely mobile and social - are involved.

- As a priority, banking IT security teams must become more knowledgeable regarding the threats posed by mobile malware. While the likelihood of attack is currently low, IDC Financial Insights believes this situation will change in 2012, as cyber criminals seek ways to exploit vulnerabilities in mobile OSs and develop more sophisticated methods by which to perform fraudulent activities.

- Banks should continue - or in some cases commence - to educate customers as to how they can identify fraudulent attempts to gain access to personal financial data (by means of phishing or smishing attacks). Historic fraud education methods have, in IDC's opinion, often been found wanting. Interactive training, where banks simulate phishing and smishing attacks to ensure customers know what signs to look out for and how to react offers a better alternative.

Innovation in the Face of 380,000 Layoffs

We have all seen the headlines of big layoff announcements in the finance industry.  It seems the headlines are never ending.  Tens of thousands of workers have been cut in 2011, and news articles are now appearing on what to expect in 2012.

Rich graph.PNG
The above chart shows the layoffs for just a few firms.  The total cuts across the industry are astounding.  Banking analyst Dick Bove of Rochdale Securities puts the 2011 total layoffs at 230,000, and over 150,000 in 2012.

As everyone in the industry scrambles to adapt, let's not forget the personal lives affected by these cuts.  A relative of mine was laid off last week from a regional bank here in the U.S.  18 years on the job, working directly with SMB clients in the field on their corporate banking needs.  6 weeks of severance and that is it.  It was completely unexpected, and he is devastated.  It is affecting his family, his marriage, and his well being.  Multiply that by 380,000 and the effects are overwhelming.

Bank Transfer Day nets 650,000 new customers for credit unions

Has there ever been a time like we are now experiencing in the world of banking?  Banking consumers have been barraged by the media, consumer groups, and even Congress on how they are being mistreated and taken advantage of by their financial services firms.

Of all the messages I've seen and heard, the most astounding was Senator Dick Durbin getting up on the floor of the U.S. Senate, urging consumers to "Get the heck out of that bank", and "vote with your feet." 

How did we get to this point?

This can all be traced back to the financial crisis in 2008. Do you remember how bad it got?  At the time, I was working in a large financial services firm, and although I wasn't an "insider" with any privileged information, the worst case scenarios were indeed very scary.  It's hard to imagine it now, but I actually withdrew $500 cash to keep in my house just in case it all came apart (which I have since returned).
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