Singapore regulator casts doubt on banking clouds

Powered by SC Magazine
 

Too risky, says Monetary Authority of Singapore.

Banks considering using third party cloud computes for core applications are likely to meet strong opposition from regulators, according to an executive at the Monetary Authority of Singapore.

Tony Chew, director of technology risk at the Monetary Authority of Singapore told a security conference in the United States that regulators were unlikely to allow a bank to put customer data into the cloud without significant due diligence, pointing out that in Singapore such behaviour could be punished with a three year jail term and a hefty fine.

"[Cloud] vendors do not understand the regulatory system and laws applying to financial services," he told McAfee's Focus 2010 security conference in Las Vegas.

Chew also pointed to outages that have affected Amazon Web Services, Google App Engine, and Microsoft Azure, suggesting that there would be a huge loss of confidence in a bank that could not continue to process transactions.

Chew was also concerned by what he termed the 'nested cloud' - scenarios in which cloud providers use services from other providers to deliver a service. A hypothetical example would be an application offered by one provider that runs on virtual servers from Rackspace and uses storage from Amazon S3.

Chew pointed to disclosures in US SEC 10-Q filings by various cloud providers as examples of further cause for concern.

Rackspace's filing, he said, notes that the majority of its customers do not pay the extra fees charged for disaster recovery services. Rackspace customers have experienced interruptions in service, he said.

"How could a bank use such a facility?" he asked, noting that 10-Q filings by Google and Salesforce.com (among others) contain similar disclosures.

While legal requirements differ between countries, regulators generally require financial institutions to demonstrate the reliability, availability, resiliency and recoverability of their systems.

In Australia, this process is overseen by the Australian Prudential Regulatory Authority (APRA) via a series of published guidelines.

The Monetary Authority of Singapore has also issued various sets of guidelines to financial institutions. Among its requirements is the mandatory use of two-factor authentication for online banking sevrices - which Chew said has practically eliminated Internet banking fraud in Singapore. He expects to add specific guidelines around cloud computing to the list in 2011.

The writer travelled to Las Vegas as the guest of McAfee.

Copyright © iTnews.com.au . All rights reserved.


Singapore regulator casts doubt on banking clouds
 
 
 
Top Stories
Hockey flags billion-dollar Centrelink mainframe replacement
Claims 30 year-old tech is holding Govt back.
 
Ombudsman wants to monitor warrantless metadata access
Requests ability to report publicly.
 
Frugality as a service: the Amazon story
Behind the scenes, Amazon Web Services is one lean machine.
 
 
Sign up to receive iTnews email bulletins
   FOLLOW US...

Latest VideosSee all videos »

The great data centre opportunity on Australia's doorstep
The great data centre opportunity on Australia's doorstep
Scott Noteboom, CEO of LitBit speaking at The Australian Data Centre Strategy Summit 2014 in the Gold Coast, Queensland, Australia. http://bit.ly/1qpxVfV Scott Noteboom is a data centre engineer who led builds for Apple and Yahoo in the earliest days of the cloud, and who now eyes Asia as the next big opportunity. Read more: http://www.itnews.com.au/News/372482,how-do-we-serve-three-billion-new-internet-users.aspx#ixzz2yNLmMG5C
Interview: Karl Maftoum, CIO, ACMA
Interview: Karl Maftoum, CIO, ACMA
To COTS or not to COTS? iTnews asks Karl Maftoum, CIO of the ACMA, at the CIO Strategy Summit.
Susan Sly: What is the Role of the CIO?
Susan Sly: What is the Role of the CIO?
AEMO chief information officer Susan Sly calls for more collaboration among Australia's technology leaders at the CIO Strategy Summit.
Meet the 2014 Finance CIO of the Year
Meet the 2014 Finance CIO of the Year
Credit Union Australia's David Gee awarded Finance CIO of the Year at the iTnews Benchmark Awards.
Meet the 2014 Retail CIO of the Year
Meet the 2014 Retail CIO of the Year
Damon Rees named Retail CIO of the Year at the iTnews Benchmark Awards for his work at Woolworths.
Robyn Elliott named the 2014 Utilities CIO of the Year
Robyn Elliott named the 2014 Utilities CIO of the Year
Acting Foxtel CIO David Marks accepts an iTnews Benchmark Award on behalf of Robyn Elliott.
Meet the 2014 Industrial CIO of the Year
Meet the 2014 Industrial CIO of the Year
Sanjay Mehta named Industrial CIO of the Year at the iTnews Benchmark Awards for his work at ConocoPhillips.
Meet the 2014 Healthcare CIO of the Year
Meet the 2014 Healthcare CIO of the Year
Greg Wells named Healthcare CIO of the Year at the iTnews Benchmark Awards for his work at NSW Health.
Meet the 2014 Education CIO of the Year
Meet the 2014 Education CIO of the Year
William Confalonieri named Healthcare CIO of the Year at the iTnews Benchmark Awards for his work at Deakin University.
Meet the 2014 Government CIO of the Year
Meet the 2014 Government CIO of the Year
David Johnson named Government CIO of the Year at the iTnews Benchmark Awards for his work at the Queensland Police Service.
Q and A: Coalition Broadband Policy
Q and A: Coalition Broadband Policy
Malcolm Turnbull and Tony Abbott discuss the Coalition's broadband policy with the press.
AFP scalps hacker 'leader' inside Australia's IT ranks.
AFP scalps hacker 'leader' inside Australia's IT ranks.
The Australian Federal Police have arrested a Sydney-based IT security professional for hacking a government website.
NBN Petition Delivered To Turnbull's Office
NBN Petition Delivered To Turnbull's Office
UTS CIO: IT teams of the future
UTS CIO: IT teams of the future
UTS CIO Chrissy Burns talks data.
New UTS Building: the IT within
New UTS Building: the IT within
The IT behind tomorrow's universities.
iTnews' NBN Panel
iTnews' NBN Panel
Is your enterprise NBN-ready?
Introducing iTnews Labs
Introducing iTnews Labs
See a timelapse of the iTnews labs being unboxed, set up and switched on! iTnews will produce independent testing of the latest enterprise software to hit the market after installing a purpose-built test lab in Sydney. Watch the installation of two DL380p servers, two HP StoreVirtual 4330 storage arrays and two HP ProCurve 2920 switches.
The True Cost of BYOD
The True Cost of BYOD
iTnews' Brett Winterford gives attendees of the first 'Touch Tomorrow' event in Brisbane a brief look at his research into enterprise mobility. What are the use cases and how can they be quantified? What price should you expect to pay for securing mobile access to corporate applications? What's coming around the corner?
Ghost clouds
Ghost clouds
ACMA chair Chris Chapman says there is uncertainty over whether certain classes of cloud service providers are caught by regulations.
Was the Snowden leak inevitable?
Was the Snowden leak inevitable?
Privacy experts David Vaile (UNSW Cyberspace Law and Policy Centre) and Craig Scroggie (CEO, NextDC) claim they were not surprised by the Snowden leaks about the NSA's PRISM program.
Latest Comments
Polls
Which bank is most likely to suffer an RBS-style meltdown?





   |   View results
ANZ
  20%
 
Bankwest
  9%
 
CommBank
  12%
 
National Australia Bank
  17%
 
Suncorp
  23%
 
Westpac
  19%
TOTAL VOTES: 1509

Vote