G-7 Runs Cyber-Security Exercise as Financial Threats Climb

(Bloomberg) -- Treasury Secretary Janet Yellen and counterparts from other leading economic powers conducted a “cyber exercise” Tuesday to showcase the importance of international cooperation amid escalating threats to the financial system.

The exercise included finance ministers and central bank chiefs from the Group of Seven nations. It “covered how G-7 members will seek to cooperate in the hypothetical event of a significant, cross-border incident affecting the financial sector,” the Treasury said in a statement Tuesday.

Policy makers and regulators in the U.S. and other countries have pointed to cyber threats from criminal and state actors as an increasing threat to financial stability. The G-7 last year laid out a multi-year testing program to improve the ability of government and private-sector actors to respond to cyber attacks.

The testing included plans for “regularly rehearsed response and recovery procedures,” according to a program description.

In an April interview with CBS’s “60 Minutes” program, Federal Reserve Chair Jerome Powell said he worried about potential scenarios in which a large payments system or financial institution might be crippled by a cyber attack.

“There’s a lot of effort going in to deal with those threats,” he said at the time. “That’s a big part of the threat picture in today’s world.”

During Tuesday’s session, Yellen “reaffirmed Treasury’s commitment to counter the threats posed by ransomware and other malicious cyber activity across the financial services sector and economy,” the statement said.

A Treasury spokesperson declined to comment on the exercise beyond the statement.

©2021 Bloomberg L.P.