This paper puts forward a multi-level model, based on system dynamics methodology, to understand the impact of cyber crime on the financial sector. Consistent with recent findings, our results show that strong dynamic relationships, amongst tangible and intangible factors, affect cyber crime cost and occur at different levels of society and value network. Specifically, shifts in financial companies' strategic priorities, having the protection of customer trust and loyalty as a key objective, together with considerations related to market positioning vis-à-vis competitors are important factors in determining the cost of cyber crime. Most of these costs are not driven by the number of cyber crime incidents experienced by financial companies but rather by the way financial companies choose to go about in protecting their business interests and market positioning in the presence of cyber crime. Financial companies' strategic behaviour as response to cyber crime, especially in regard to over-spending on defence measures and chronic under-reporting, has also an important consequence at overall sector and society levels, potentially driving the cost of cyber crime even further upwards. Unwanted consequences, such as weak policing, weak international frameworks for tackling cyber attacks and increases in the jurisdictional arbitrage opportunities for cyber criminals can all increase the cost of cyber crime, while inhibiting integrated and effective measures to address the problem.
scite is a Brooklyn-based organization that helps researchers better discover and understand research articles through Smart Citations–citations that display the context of the citation and describe whether the article provides supporting or contrasting evidence. scite is used by students and researchers from around the world and is funded in part by the National Science Foundation and the National Institute on Drug Abuse of the National Institutes of Health.
hi@scite.ai
10624 S. Eastern Ave., Ste. A-614
Henderson, NV 89052, USA
Copyright © 2024 scite LLC. All rights reserved.
Made with 💙 for researchers
Part of the Research Solutions Family.