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SCI/TECH: Cyber Fears On Federal Reserve's Web Plan

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posted on Aug, 16 2004 @ 10:39 AM
The Federal Reserve is launching their new web-based funds transfer service as a replacement to their DOS-based FedWire program. Called FedLine, this new program seeks to provide the Fed's customers with more flexibility and options in transfering funds. The current system transfers about $1.8 trillion per day, with an average transfer of $3.5 million per transaction.
With little fanfare, the Federal Reserve will begin transferring the nation's money supply over an Internet-based system this month a move critics say could open the U.S.'s banking system to cyber threats.

The Fed moves about $1.8 trillion a day on a closed, stand-alone computer network. But soon it will switch to a system called FedLine Advantage, a Web-based technology.

Proponents say the system is more efficient and flexible. The current system is outdated, using DOS Microsoft's predecessor to the Windows operating system.

But security experts say the threat of outside access is too big a risk.

"The Fed is now going to be vulnerable in two distinct ways. A hacker could break in to the Fed's network and have full access to the system, or a hacker might not have complete access but enough to cause a denial or disruptions of service," said George Kurtz, co-author of "Hacking Exposed" and CEO of Foundstone, an Internet security company.

Please visit the link provided for the complete story.

In today's world of cyberterrorism and cyber-espionage I find it alarming that the Federal Reserve would even promote this product. As a techonologist who happens to earn a living by developing systems over the internet I can understand the need to replace antiquated systems and provide more functionality to customers; but customers should have signed a non-disclosure (which they surely did) and the Fed should have kept their mouth shut about this.

As Ron Gula, president of Tenable Network Security, states in the article, no [online] system is 100% secure. This brings to mind three fears: a massive disruption of internet capacity, specific DOS attacks and hacking into Fedline. Any of these could potentially bring the new system to its knees. The duration of the outage/attack would determine the impact to our financial system.

[EDIT]: Interestingly, information on FedLine is quite accessible. Here's a google search page. I have not browsed the results yet -- I'm just sharing the information.

Google Search:

[edit on 8/16/2004 by titian]

[edit on 16-8-2004 by John bull 1]

posted on Aug, 17 2004 @ 04:45 AM
Oh this is just lovely. Why not transfer the money in the back of a pickup truck instead. Is it just me or does this seem extremely idiotic? Basically the system wasn't broken so they fixed it. The greatest prize in hacker history will be to hack fedline.

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