Widespread Impact
When Vendor Breaches Ripple Through the Financial Ecosystem
A cybersecurity incident, or even a systemic outage at a single vendor, can send shockwaves throughout the interconnected financial ecosystem. Even the most secure financial institutions are vulnerable if a critical third-party service provider experiences disruption, underscoring the critical importance of a comprehensive supply chain risk management strategy.
The following examples highlight how vulnerabilities and disruptions in the vendor landscape can have widespread, cascading effects on financial services.
Case Study: Snowflake Cloud Data Platform Compromise Impacts Major Financial Clients
Overview:
- In 2024, Snowflake, a leading cloud-based data warehousing platform, became the epicenter of a series of high-profile compromises affecting its clients and their downstream ecosystems due to unauthorized network access.
- This incident revealed a significant gap in the adoption of essential security controls, particularly multi-factor authentication (MFA), and highlighted the need for continuous monitoring to detect early signs of unauthorized activity.
- Experts noted that a lack of robust detection mechanisms could have flagged unauthorized access earlier in the attack chain, emphasizing the necessity of comprehensive security measures in cloud environments.
Attack Details:
- Attackers leveraged infostealer malware to compromise credentials, gaining unauthorized access to Snowflake accounts that lacked multi-factor authentication (MFA).
- The breach resulted in data exposure for Snowflake’s customer organizations, collectively impacting millions of individuals.
- Technical analysis revealed that many of the compromised credentials had been harvested through prior malware infections and traded on dark web forums.
- Attackers exploited these stolen credentials to access sensitive datasets stored within the Snowflake platform, including financial information, operational data, and customer records.
Impact on Financial Services:
- The compromise had extensive downstream effects across the financial sector.
- Santander Bank and LendingTree were among the affected financial clients, requiring rapid incident response and communication strategies to mitigate the risk of fraud and identity theft for their customers.
- The incident underscores how a vulnerability in a single widely-used platform can create significant ripple effects, extending risk far beyond the initially compromised service.
Lessons Learned:
- The Snowflake breaches serve as a stark warning about the cascading risks inherent in cloud-based ecosystems.
- Organizations relying on third-party platforms must adopt stringent security practices, including mandatory MFA for all accounts, regular credential hygiene, and proactive, continuous monitoring of their cloud environments.
- These measures are vital to safeguarding against credential-based attacks that exploit the pervasive interconnectivity of modern supply chains.
Black Kite’s Supply Chain shows users where Snowflake is being used throughout their Nth-party ecosystem:
Case Study: Cleo Managed File Transfer Exploitation Causes Supply Chain Disruptions
Overview:
- Following the Blue Yonder attack, vulnerabilities in Cleo’s Managed File Transfer (MFT) solutions became a significant focus of exploitation by the Cl0p ransomware group.
- It is critical to clarify that Cl0p did not breach Cleo directly but leveraged vulnerabilities in Cleo’s widely used products, such as Harmony, VLTrader, and LexiCom, to target companies relying on these solutions for supply chain operations.
- This campaign mirrors Cl0p’s previous exploitation of MOVEit and GoAnywhere products, highlighting their focus on systemic vulnerabilities in Managed File Transfer tools.
Attack Details:
- The exploitation began in December 2024, with Cl0p actively targeting companies using unpatched versions of Cleo’s MFT products.
- The group utilized a combination of CVE-2024-50623, allowing unrestricted file uploads and remote code execution, and CVE-2024-55956, a zero-day vulnerability enabling data exfiltration.
- By December 13, Cl0p publicly claimed responsibility, listing 66 victims on their dark web extortion site.
- Researchers estimated that the actual number of impacted organizations could be in the hundreds, given Cleo’s widespread adoption in industries like retail, logistics, and manufacturing.
Impact on Financial Services-Related Supply Chains:
- The exploitation resulted in operational disruptions across various sectors linked to financial supply chains.
- Retailers faced delays in shipment tracking and inventory management, while manufacturers reported production halts and increased downtime due to compromised integrations.
- These disruptions highlight how an attack on a software tool can have far-reaching consequences for the entire operational flow of businesses that are integral to the financial ecosystem.
- Organizations using Cleo’s products were urged to prioritize immediate patching to version 5.8.0.21 or later, implement stricter access controls, and enhance monitoring for Indicators of Compromise (IoCs).
Lessons Learned:
- This ongoing campaign emphasizes the urgent need for proactive vulnerability management and robust supply chain risk assessments.
- Organizations must collaborate closely with their third-party vendors to address known vulnerabilities swiftly and implement strong defensive measures to ensure resilience in interconnected ecosystems, preventing single points of failure from causing widespread disruption.
Black Kite’s Supply Chain shows our users their Nth-party ecosystem filtered by Cleo FocusTagsTM:
Case Study: Fiserv Widespread Banking Outage Disrupts Services Across U.S.
Overview:
- In a stark reminder that not all significant disruptions are cyberattacks, financial institutions operating in the United States experienced widespread outages following a service disruption at financial technology provider Fiserv on May 2, 2025.
- This incident, while not a cyber event, led to significant impairment across multiple banks and credit unions, affecting their ability to deliver critical banking services to customers.
Incident Details:
- Fiserv supplies the infrastructure behind many major financial institutions' digital platforms.
- Banks affected included major players such as Ally, Bank of America, TD Bank, Capital One, Synchrony, and Citizens Bank, as well as regional and local institutions like Northwest Bank, Sunflower Bank, and Farmers National Bank in Ohio.
- Credit unions such as Navy Federal were also impacted, and even money transfer service Zelle appeared to be affected.
- The outage occurred during a planned "enhancement" of the network infrastructure at a Fiserv data center.
Impact on Financial Services:
- The widespread nature of the outage meant that critical banking services, such as account access, fund transfers, and payment processing, were unavailable to a vast number of customers.
- While the issue was resolved within a day, the incident underscored the profound interconnectedness and fragility of modern financial infrastructure.
- It demonstrated that even an operational glitch at a single, critical third-party provider can bring significant portions of the financial ecosystem to a standstill, causing inconvenience to millions and raising concerns about resilience.
Lessons Learned:
- This event highlights that "supply chain risk" extends beyond traditional cyber threats to include operational failures or technical issues at key service providers.
- Financial institutions must assess and plan for disruptions from all types of vendor incidents, ensuring redundant systems and robust continuity plans are in place for critical third-party dependencies.
- It reinforces that a strong defense is not just about preventing malicious attacks, but also about preparing for any event that can compromise the availability and integrity of services delivered through the supply chain.