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Fed's Lockhart warns of cyber threats to financial system

Nov 27 2012 Reuters

A top U.S. Federal Reserve official warned on Tuesday of potential risks to financial stability from cyberattacks on the U.S. payments system and from a looming funding gap in public pensions. In a speech to a conference in the German capital, the president of the Atlanta Federal Reserve, Dennis Lockhart, said that at a global level the span of vigilance needed to be extremely broad. "Our radar should scan widely - beyond the most obvious sources of risk," said Lockhart, according to the text of his speech, arguing that markets viewed by some as too small to cause much trouble before the 2008 crisis had ended up posing systemic-scale problems. Homing in on the issue of cyber-security, he said the fragmented nature of the U.S. payments industry and its rapid evolution were creating many areas of vulnerability. "A real financial stability concern, however, is the potential for malicious disruptions to the payments sytem in the form of broadly targeted cyberattacks,"

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