H. Alper Memis
When the U.S. Treasury Department was breached, one question raced through the minds of CISOs across the financial sector: Are we next? The concern was justified — Gartner predicts that software supply chain attacks like the one that struck the Treasury will cost $138 billion by 2031. That’s a 300% spike in just two years. Financial services companies are prime targets because the stakes are so high and a single breach can lead to millions in direct costs, regulatory fines and reputational damage.
Why financial institutions need more than traditional defenses
Banking, financial services and insurance (BFSI) companies must protect themselves against a constant stream of inbound attacks, every hour of every day. These threats are becoming more sophisticated and harder to detect. They can arise from a variety of sources, including third-party vendors (like BeyondTrust in the Treasury attack), unpatched vulnerabilities, misconfigurations in cloud or on-premise environments, shadow IT, SaaS applications and more. Although these risks exist across industries, BFSI companies face unique challenges that require a more aggressive and proactive approach to protecting their infrastructure.
- High-value targets:S. banks hold more than $30 trillion in assets, which is why financial institutions are among the most targeted entities in the world by everyone from nation-state attackers to ransomware gangs.
- Regulatory pressure: Regulations like DORA, the NIST Cybersecurity Framework, the New York Department of Financial Services (NYDFS) Cybersecurity Rule and others require evidence that security controls are in place and performing as expected. While some frameworks are voluntary, others are legal mandates that have associated costs if not met. OneMain Financial Group was famously charged $4.25 million by the state of New York in 2023 for violations of DFS’s Cybersecurity Regulation.
- Big (but often unvalidated) security investments: Most financial institutions pour millions into firewalls, endpoint tools and SIEM platforms, but they struggle to confirm whether those systems are effectively working together to stop legitimate threats. This can result in breaches even though there are big line items for security tools.
How Adversarial Exposure Validation mitigates BFSI risks
Adversarial exposure validation (AEV) answers a critical question: Can a specific threat bypass our defenses, and what path would it take right now?
AEV combines Breach and Attack Simulation (BAS) and automated Penetration Testing to continuously test your environment using real-world attack methods and threat actor behaviors. It doesn’t rely on generic CVSS scores or hypothetical risk. It provides live, context-aware validation to help teams zero in on exposures that actually pose a risk to their environment. During high-profile breaches, a financial institution using AEV could immediately determine whether its systems were susceptible to the specific exploit. That saves time, eliminates guesswork and helps teams move from reactive firefighting to proactive defense.
Read More: From Reactive to Resilient: 3 Practices to Help Financial Firms Thrive Amid Regulatory Change
How to implement AEV to tighten the vault
AEV offers several advantages to organizations that want to improve security posture efficiently and effectively on an ongoing basis. But, like any new process or technology, AEV must be thoughtfully implemented to be successful. Here are things technology leaders should consider when deploying it.
- Start with foundational use cases. Simulate known threats against your environment and confirm that your defenses actually detect, block and alert on them.
- Use context to prioritize risk: Not all vulnerabilities matter equally. A critical CVE that’s already blocked by your firewall should not consume the same attention as an issue that’s invisible to your detection stack. AEV helps prioritize based on what’s exploitable in your environment, not someone else’s.
- Consider compliance as the floor, not the ceiling: While many programs begin with compliance drivers, the true value of AEV is operational. It allows teams to catch misconfigurations, validate detection logic, respond faster when threats emerge and automate for ongoing protections.
Risks to BFSI will continue to grow
Financial institutions can’t afford to rely on yesterday’s tactics. Traditional vulnerability assessments are often siloed, disconnected from the business context and too slow to adapt. They may surface hundreds of issues but offer little clarity on what’s actually exploitable in your environment. AEV changes that. Simulating real-world attack paths across cloud, on-prem and hybrid systems helps security leaders understand which exposures pose real danger. That makes it easier to allocate resources, shore up defenses, and, most importantly, stay ahead of attackers.
Read More: Global Fintech Interview with Slava Akulov, CEO & Co-Founder at Jupid Tax
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