Wall St. Hack Cause Havoc Among Lawmakers And Investors

Being the victim of a hack is never a good thing, but when the target is a top US regulator overseeing trading at Wall St., the situation becomes catastrophically more consequential. This is exactly what the U.S. Securities and Exchange Commission (SEC) is facing right now when it was revealed that a hack involving its filing system called EDGAR might have led to a fair bit of insider trading.

According to the SEC, the hack actually occurred in 2016, but it wasn’t until recently that the regulatory agency found that the hack could have allowed for improper trading. The incident was reported by SEC Chairman Jay Clayton on Wednesday, The Washington Post reports, who mentioned neither the date of the hack or which companies have been targeted.

“Notwithstanding our efforts to protect our systems and manage cybersecurity risk, in certain cases cyber threat actors have managed to access or misuse our systems,” Clayton said.

It would seem that the hack did not result in personal information being stolen, but there was enough trading data taken to allow for a huge advantage in the stock market. One of the most likely results from this development is the reduced capacity of the SEC to collect and store trading data on its servers.

Of course, the loss of confidence in the agency is the least of its worried right now, as lawmakers and investors are also rattled by this event. The Senate will be conducting an investigation into the matter, Reuters reports, and SEC officials are likely to be grilled over the nature and specifics of the data that were stolen.

Traders are also not likely to feel very confident in the SEC’s ability to keep Wall St. in check, now that its security has been breached. If one hacking incident from last year could enable elicit trading, what’s to stop others from doing the same thing?