Financial Risk Manager Part 1
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The hacking of the Society for Worldwide Interbank Financial Telecommunication, also known as SWIFT that led to the loss of approximately $81 million from the Central Bank of Bangladesh highlighted the exposure of individuals and institutions to cyber risk. Which of the following is an appropriate definition of cyber risk?
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Community
TTanishq
A
The potential for adverse consequences arising from unauthorized access, use, disclosure, disruption, modification, or destruction of information systems, digital assets, or data.
B
The potential for negative impacts on an individual or organization's reputation due to factors such as data breaches, privacy violations, or unethical practices.
C
The potential for losses or damages stemming from insufficient or malfunctioning internal controls, technology failures, or human errors in the context of an organization's operations.
D
The potential for adverse outcomes arising from inaccuracies, limitations, or
Explanation:
Explanation
Cyber risk is specifically defined as the potential for adverse consequences arising from unauthorized access, use, disclosure, disruption, modification, or destruction of information systems, digital assets, or data. This definition directly addresses the core elements of cybersecurity threats.
Analysis of each option:
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Option A: Correct - This is the precise definition of cyber risk, covering all key aspects including unauthorized access, data breaches, system disruptions, and destruction of digital assets.
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Option B: Incorrect - This describes reputational risk rather than cyber risk. While cyber incidents can affect reputation, the definition focuses on reputation impacts rather than the technical aspects of cybersecurity.
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Option C: Incorrect - This describes operational risk, which is broader and includes various types of operational failures, not specifically focused on cybersecurity threats.
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Option D: Incomplete - The option appears to be cut off, but based on the context, it likely refers to model risk or data quality risk, not cyber risk.
The SWIFT hacking incident mentioned in the question perfectly illustrates cyber risk, as it involved unauthorized access to financial systems leading to significant financial losses.
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