The Israeli Ministry of Finance hosted a simulation of a major cyberattack on the global financial system on Dec. 9 in a multinational security exercise called Collective Strength, which involved representatives from 10 countries as well as some international financial agencies.
The Collective Strength simulation comes after the related World Economic Forum’s (WEF) Cyber Polygon 2021 symposium, where a “total of 200 organizations from 48 countries” focus on improving “cybersecurity as their strategic priority and seek to develop their cyber defense competencies.”
“We all know, but still pay insufficient attention to, the frightening scenario of a comprehensive cyberattack, which would bring a complete halt to the power supply, transportation, hospital services, our society as a whole,” Klaus Schwab, chairman of the WEF, said at Cyber Polygon 2020.
The participants included treasury officials from Israel, the United States, the UK, the United Arab Emirates, Austria, Switzerland, Germany, Italy, the Netherlands, and Thailand, as well as representatives from the International Monetary Fund, World Bank, and Bank of International Settlements.
The cyberattack simulation, which was originally scheduled to take place at the Dubai World Expo, was moved to Jerusalem in video conference format “due to the Omicron variant of COVID-19.”
The cyber “war game” simulation was being planned by the Israeli government over the past year, Reuters reported.
The exercise, which ran for 10 days, involved a complex attack on the global financial markets, in which the attackers’ plans were many steps ahead of the defenders’.
In this scenario, “sophisticated” players used several types of attacks that affected global foreign exchange and bond markets, liquidity, the integrity of data, and transactions between importers and exporters.
The simulation also involved fake news reports that instigated mass panic in the markets and leakage of sensitive data emerging on the Dark Web, followed by a run on the banks.
The cyber war game began with a film, with a narrator explaining, “These events are creating havoc in the financial markets,” and that governments were under pressure to manage the impact of the attack, which was paralyzing the global financial system.
“The banks are appealing for emergency liquidity assistance in a multitude of currencies to put a halt to the chaos as counterparties withdraw their funds and limit access to liquidity, leaving the banks in disarray and ruin,” the narrator said.
The participants discussed a multilateral contingency plan on how to respond to a related crisis, including coordinated bank holidays, debt repayment grace periods, SWAP/REPO agreements, and coordinated delinking from major currencies.
The Israeli Finance Ministry said that such threats are becoming increasingly worrisome after several high-profile cyberattacks on major companies and governmental institutions.
The simulation’s hosts believe that present-day cybersecurity would be unable to withstand such an assault and that the only way to contain any such damage is through multinational coordination between states and international organizations.