Hackers Break into Flagstar Bank via Fiserv and MOVEit Vulnerabilities

  • By Steven
  • Oct 11, 2023

Hackers Break into Flagstar Bank

Flagstar Bank is one of the largest national banks in the country. They operate over 430 branches and 120 banking teams from coast to coast. Flagstar is also the nation’s second-largest mortgage warehouse lender, servicing over 1.6 million accounts. Flagstar Bank’s conglomerate is based in New York, while their servicing is in Michigan. Flagstar oversees billions of dollars in loans, deposits, assets, and equity. If you bank or manage a mortgage with Flagstar, your personal and financial information may be at risk. The bank has been hacked thrice since 2021, losing thousands of consumer details.

How Did the Attack Occur? 

The breach occurred via Flagstar’s mobile banking and payment processing vendor, Fiserv. The vendor utilizes a file application called MOVEit, which has had some of the most extensive data breaks this year. The assailants stole Flagstar’s consumer information from the Fiserv-maintained MOVEit servers. This data theft was made possible by MOVEit’s zero-day vulnerabilities, which they rectified upon discovery. The attacks did not impact Flagstar’s ability to serve consumers, but they may have exposed 830,000+ unique financial records. 

What Information was Viewed or Stolen? 

The stolen information may vary between individuals, though the exact scope of the exposure is still unknown. According to the Maine Attorney General, the breach involved full names and Social Security Numbers (SSN); the attackers may have stolen other personal details, but Flagstar’s notification does not list the possibilities. It is reasonable to suspect more personal details than a name and SSN got taken due to Flagstar’s prior data breaches. In the last two years, consumers and employees had their information stolen; this includes names, addresses, phone numbers, SSNs, and tax records. Malicious actors may misuse stolen information at any time, so take protective measures now for mitigation.

How Did Flagstar Bank Admit to the Breach? 

From May 27th to May 31st, opportunistic hackers break into MOVEit and begin pirating information. Around this time, Progress Software (owners of MOVEit) discovered a significant vulnerability in their MOVEit application. As of this writing, it is unknown when Flagstar became aware of the breach; however, the Maine Attorney General’s notification implies they discovered the attack on or around October 3rd. Three days later, on October 6th, Flagstar released its consumer notification and began sending direct notices to those possibly impacted. 

What Will Become of the Stolen Information? 

We know little about the stolen information in this breach. An estimated 837,390+ consumer names and SSNs may be exposed. At worst, the thieves may have also acquired those consumers’ financial, identity, and tax information. Based on Flagstar’s recent multi-breach history, we suspect the information may have included these elements. Due to the lack of confirmed breach data, it is impossible to predict how the hackers may use the information beyond identity fraud (SSN) or impersonation (name).

What Should Affected Parties Do in the Aftermath of the Breach? 

Regardless of the specific credentials exposed during the breach, you must immediately act if the breach impacts your information. Enlist credit and identity monitoring as soon as possible, as well as financial guardian services. It is unnecessary to leave Flagstar Bank because the attack occurred via a third party; however, three breaches in two years may not instill confidence in their third and fourth-party policies. The best way to protect yourself is by enabling multi-factor authentications and considering filing taxes early.

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