Idaho Sen. Jim Risch, the top Republican on the Foreign Relations Committee—who also serves on the Intelligence Committee—says he would be surprised if they didn’t mimic the digital pressure campaign that experts are using. believed to have caused bank withdrawals. “We see all kinds of input from foreign actors trying to do harm to the country, so it’s really a clear path for someone to try to do that,” said Risch.
Some experts think the threat is real. “Fear is not inflated,” Singer Peter Warren, strategist and senior fellow at New America, a Washington-based consulting organization, told WIRED via email. “Most cyber threat actors, whether criminal or state, do not create new vulnerabilities, but notice and then capitalize on existing ones. And it’s clear that both the stock market and social media can be manipulated. Add them together and you’ll multiply your ability to manipulate.”
Following a rally fueled by the GameStop meme—driven in part by a desire to wipe out hedge funds that are shorting stocks—experts have warned similar techniques could be used to target into banks. IN an article for the Carnegie FoundationPublished in November 2021, Claudia Biancotti, director of the Bank of Italy, and Paolo Ciocca, Italy’s financial regulator, warn that financial institutions are susceptible to similar market manipulation.
“Finance-focused virtual communities are growing in size and potential social and economic impact, reflected in the role of online retail merchant groups in the GameStop case,” they wrote, “Such communities are highly susceptible to manipulation and may represent a prime target for state and non-state actors conducting malicious disinformation activities.”
The government’s response to the collapse of the Silicon Valley Bank—Depositors’ funds are quickly protected—showing that banks can be resilient against this kind of event, say Cristian Bravo Roman—an expert in AI, banking, and contagion risk at Western University in Ontario. “All the measures that have been taken to restore confidence in the banking system limit the capabilities of a hostile attacker,” he said.
Roman said federal officials have now seen, or at least should have seen, the real cyber threat of mass digital hysteria, and could strengthen provisions designed to protect protect smaller banks from withdrawals. “That completely depends on what happens after that,” Roman said. “The truth is, the banking system is both political and economic.”
Preventing outbreaks of online panic attacks, real or fabricated, is much more complicated. Social media sites in the US cannot easily be forced to remove content and they are protected by Article 230 of the Communications Decency Act of 1996, which protects technology companies from liability for what others write on their platforms. Although that provision is currently being challenged in the US Supreme Court, it is unlikely that lawmakers would want to restrict what many see as free speech.
Senator Richard Blumenthal, a Connecticut Democrat, said: “I don’t think social media can be regulated to censor information about a bank’s financial position unless there is manipulation. manipulation or intentional misinformation, just as it can in any other media.”
“I don’t think we should come up with a systemic response to a local issue,” said North Dakota Republican senator Kevin Cramer – although he added that he wanted to hear “all arguments.”
“We need to be very careful not to interfere with the way we talk,” says Cramer. “But when speech is specifically designed to short a market, for example, or to lead to an unnecessary bank run, we have to be rational about it.”
While some members of Congress are using the Silicon Valley Bank race to revive discussions about the regulation of social media platforms, once again, lawmakers Others look to technology companies themselves to find solutions. “We need to better detect and expose bots. We need to understand the source,” said Senator Angus King, a Maine independent.
King, a member of the Senate Intelligence Committee, said that Washington cannot solve all of Silicon Valley’s problems, especially when it comes to bot cleaning. “It has to be them,” he said. “We can’t do that.”
