IT security crucial to UAE

DUBAI — IT security is crucial to the UAE financial markets, as the financial sector in particular has always been a target for fraud worldwide, according to Khalfan Al Mazrouei, IT manager, Abu Dhabi Securities Market (ADSM).

By Jamila Qadir

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Published: Sun 2 Jul 2006, 10:57 AM

Last updated: Sat 4 Apr 2015, 2:55 PM

The dramatic growth in Internet and email use has helped and hindered financial markets. Internet and email gives investors instant access to financial markets all over the world. But both have also opened up new opportunities for hackers to exploit, he explained.

Pressures on security come from within a corporation as well as outside. Up to 70 per cent of all IT security fraud is internal. "No matter how advanced our systems are, we are always vulnerable," he said.

Since it was established in November 2000 ADSM has made IT security one of its top priorities as part of its international best practices programme. ADSM is playing a leading role in promoting security awareness across the market. It has already improved and broadened its trading and registry reporting services to shareholders through voice, Internet and mobile systems.

"We have also introduced e-trading for brokers. In fact, the majority of them now operate remotely which poses a huge security challenge for our IT systems. We have enhanced transparency by introducing International Financial Reporting Standards (IFRS) compliance and quarterly reporting from all ADSM listed companies."

The UAE is the first country in the Middle East to be awarded an XBRL (eXtensible Business Reporting Language) provisional jurisdiction. It allows companies to compile and publish financial data in a format that can be better understood and analysed than the current process. This will enhance transparency in the market, he said.

ADSM, with the UAE XBRL steering committee, has been instrumental in this move. "We will be taking a lead in encouraging all UAE listed companies to adopt XBRL to improve both transparency and efficiency in the market. Our IT systems have had to evolve to deal with new office openings, a huge increase in the number of brokerage firms and new links with foreign exchanges."

National investors should be able to trade foreign stocks from ADSM. They should not have to expose themselves to the risk of trading directly on a foreign exchange, he said, adding that was the reason why ADSM has created links with other foreign exchanges.

"We currently have an electronic link with Muscat and we are introducing another one with Doha. We also have cross-listing agreements in place with the Cairo & Alexandria (CASE) and Khartoum exchanges. We look forward to further links with other exchanges in the near future," Al Mazrouei said.

The number of trades on ADSM this year goes up each month compared to 2005. Since the inception, it has opened four regional branches throughout the UAE and will be opening a further two this year.

ADSM now has over 60 broker firms operating in its market. Almost half of these opened in the first quarter of this year alone, he said.

One of ADSM's current aims is to become the first exchange in the UAE to achieve ISO 17799 certification, which will enhance the security procedures between the brokers, registrars and investors, he added.

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