Hearing of the Subcommittee on Financial Institutions and Consumer Credit - "Cybersecurity: Threats to the Financial Sector."

Statement

Congresswoman Shelley Moore Capito, R-W.Va., Chairman of the Subcommittee on Financial Institutions and Consumer Credit, delivered the following opening remarks at today's subcommittee hearing entitled "Cybersecurity: Threats to the Financial Sector." For more information on the hearing click here.

Remarks as prepared for delivery:

This hearing will come to order. This will be our first hearing in the Financial Institutions Subcommittee since the August recess. I would like to remind members to abide by the five minute rule when questioning witnesses so all members have sufficient time to ask questions.

Today's hearing will provide members of this subcommittee the opportunity to better understand the challenges financial institutions and their customers face from cyber threats. This year alone there have been numerous security breaches and attacks on private companies, federal agencies, and financial institutions. Reports estimate that more than $1 trillion is lost annually to cyber attacks and that on average a security breach costs a small business approximately $7 million.

These threats are especially acute in the financial services industry. In June of this year, Citigroup reported that sensitive account information for 200,000 customers had been compromised by hackers. Statistics show that most of these attacks originate in Eastern European countries that were once part of the Soviet Union. Unfortunately, most of these nations do not regard the actions of the hackers to be a crime so it is very difficult to bring these criminals justice.

The technological advances that provide hackers with the ability to carry out these attacks also make it very difficult to track the actions of the hackers. In order to effectively combat these hackers it is critical for financial institutions to share information with other institutions as well as federal law enforcement agencies.

The Administration and Congress are actively working on ways to better protect our nation's businesses and citizens from these attacks. Today's hearing is just one component of this work.

I look forward to hearing from both witness panels this morning. Their testimony and candid conversation will provide members with a better understanding of this complex issue. I am especially interested to hear from our witnesses about the creation of the Office of Financial Research as called for by the Dodd-Frank Act. I have serious reservations about the creation of this new bureaucracy, and I am most concerned with the potential for new cyber threats. By compiling sensitive financial information into one federal agency, are we just making it easier for hackers to attack us?

Finally, I would like to express my disappointment that the OCC was unable to provide a witness for this hearing. As the primary supervisory body for many of our nation's largest financial institutions, their cooperation and active participation in this discussion is critical. I hope that they recognize the role they play in this conversation and become an active participant.

I would now like to recognize the Ranking Minority Member, the Gentlelady from New York, Ms. Maloney for the purpose of making an opening statement.

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