Terrorists have put a bulls-eye on the U.S. financial system, including payments infrastructure, as a target that fits in with their plans to cripple the country's economy, says Juan C. Zarate, senior adviser for the Center for Strategic and International Studies.
"The payments infrastructure and systems are at the heart of national security issues," says Zarate, who previously served as deputy assistant to the president and national security adviser. In addition, Zarate served as the first assistant secretary of the Treasury for terrorist financing and financial crimes.
Through extensive monitoring of terrorist affairs and movements since the 9/11 attacks, the federal government understands terrorism has moved into the "financial warfare lane" as cyberattacks target banks, Zarate said during his presentation at the Chicago Payments Symposium this week at The Federal Reserve Bank of Chicago.
By the same token, the U.S. government has used its financial power to freeze assets and isolate "the actors" of cybercrime seeking to harm the country, he adds. Those "actors" include terrorist groups that have split up into various parts of the world, organized crime groups and powerful cartels.
"These groups know how to use the global payments and financial systems to finance themselves," Zarate says. "They believe inherent economic liabilities exist in the U.S. and that they can attack the economic well-being of the country."
Those in payments must continue to work to strengthen the security of the payments infrastructure because terrorists would love to shut down the system and shake the confidence of American consumers in doing so, Zarate says.
Zarate contends that building security for payments alone is not enough. In the world of global terror, an attack on one major system may affect all others, he says.
"As the potential grows for building or upgrading the payments system, you have to ask how it relates to other key structures in the U.S.," Zarate says.
Regulations and broader policies that take all essential systems into account will help payments play its role in an "economic-security environment," he adds.
Such an environment gives the Federal Reserve Board or any other prominent payments player the chance to help the country shape its security measures against terrorism, Zarate says.