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Industry roundup: 04 March

New US cybersecurity law: companies required to report cyberattacks

The US Senate passed a cybersecurity bill on Tuesday requiring companies to report ransomware payments and malicious hacks to the government to protect critical US infrastructure. According to the Strengthening American Cybersecurity Act, it consists of three legislations aimed at improving public and private sector security, including modernizing federal agencies' cyber posture and updating cloud-based technology adoption practices. Affected companies must report specific breaches within 72 hours and ransomware payments to the Cyber ​​Security and Infrastructure Security Agency (CISA) within 24 hours.

According to the WSJ, improvement on the visibility of privately owned computer networks has been of critical importance. In 2020, a cybersecurity firm revealed a Russia-linked breach of federal agencies via a compromised SolarWinds Corp. software update. Additionally, a ransomware attack on the Colonial Pipeline Company disrupted the largest fuel pipeline on the US East Coast last year, which forced authorities to unveil sector-specific regulations requiring many pipelines and railroad operators to report hacks.

The new law would extend these rules to many companies in the 16 federally-designated critical infrastructure sectors, such as energy and financial services. US officials want to analyse and share cyberattack data between federal agencies and private companies to prevent similar incidents in the future.

The bill provides guidance on which companies fall under the rules, citing potential economic turmoil and national security threats, but CISA makes certain decisions in a formal rule-making process. Additionally, CISA determines the types of incidents a company must report and the information it must share. Companies would be protected from liability for the information they share, and incur no penalties for failing to comply, according to CISA

US government task force initiated to catch cryptocurrency use as way of avoiding Russian sanctions

The US government launched a new initiative on Wednesday to counter the use of cryptocurrencies and assets to circumvent new sanctions imposed on Russia. Attorney General Merrick Garland, via the US Department of Justice's (DoJ) Office of Public Affairs, publicized the creation of Task Force KleptoCapture, a team dedicated to enforcing the sweeping sanctions, export restrictions and economic countermeasures that the US has imposed along with allies and partners.

According to the DOJ, KleptoCapture targets those who are trying to use cryptocurrencies to circumvent US sanctions, those who are laundering foreign corruption revenues, and those seeking to evade the US response to Russia's military aggression. Garland revealed that the Task Force should be able to identify sanction evasion and related criminal activity using state-of-the-art investigative techniques such as data analytics, cryptocurrency tracing, foreign intelligence sources, and information from financial regulators and private sector partners. Additionally, the Justice Department will seize the assets of individuals or entities who violate sanctions and prosecute those whose criminal acts enable the Russian government to continue this conflict.

Ripple’s innovative technology moves towards crypto payments

US-based blockchain technology company Ripple, which utilized cryptocurrency technology to create its brand and expedite global payments, is now shifting towards acclimating its technology to everyday payments. Sendi Young, London-based managing Director, Ripple, commented that the company previously focused on addressing cross-border payment issues but has refocused due to the increased demand in cryptocurrency.

Through partnerships, Ripple expanded its product range to create a platform for both cryptocurrency transactions and traditional payments. The latest addition is a partnership with London-based fintech Modulr, which provides connectivity to payment messaging protocols in different countries, such as Faster Payments, Bacs, Chaps, SWIFT and SEPA.

In late 2021, Ripple updated RippleNet, a platform that combines crypto with various financial services, with the addition of Liquidity Hub, a product aimed at corporate partners on Ripple's blockchain network. The liquidity hub is described as supporting the purchase, sale and possession of digital assets. According to Ripple, companies should source an assortment of assets from the broader crypto market efficiently through this hub. Young described the liquidity hub as an “aggregator” similar to what Kayak does for travel.

Many payment fintechs use cryptocurrency trading to build account balances, enabling these accounts to convert to traditional currencies for e-commerce payments and P2P transfers. Other payment networks that support payments for crypto and digital assets, such as PayPal, Visa, Block/Square and Mastercard, are already connected to thousands or millions of merchants, either through third-party services or directly.

According to Young, the decentralization of blockchain-based solutions enables banks and other financial institutions to communicate payment information with each other in real time in both directions, which is significant in correspondent banking. Additionally, Young stated that Ripple is working towards digitizing government currencies, having already collaborated with the Royal Monetary Authority of Bhutan and the Republic of Palau.

EMQ’s footprint expands further into South Asia, enabling real-time cross-border payments

Global payment network company EMQ launched real-time payments to Pakistan, strengthening payment capabilities across South Asia and opening up more markets. According to EMQ, the expansion of their network into the domestic market should provide more affordable and accessible financial services while also providing real-time payments to Pakistan's mobile wallets and bank accounts, or cash receipts to customers around the world. Steven Liu, Global Head of Networks and Expansion, EMQ, commented that remittances play an important role in contributing to South Asia’s economic growth, but the cost of fund transfers remains high.

As digital payments continue to emerge, and EMQ’s real-time payment network expands, customers in Pakistan should be able to transfer money seamlessly to their mobile wallets and bank accounts. Further expansions to the United States, Canada and Latin America are expected in the near future.

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