Cybersecurity Archives | Page 5 of 376 | Digital Watch Observatory

SHEIN faces Irish inquiry over EU data transfers to China

Ireland’s Data Protection Commission has opened an inquiry into Infinite Styles Services Co. Ltd. (known as SHEIN Ireland), over transfers of personal data of EU and EEA users to China.

The inquiry will examine whether SHEIN Ireland has complied with its obligations under the General Data Protection Regulation in relation to those transfers. The DPC said it will assess compliance with GDPR principles on personal data processing, transparency obligations under Article 13, and Chapter V requirements governing transfers of personal data to third countries.

The regulator said its decision to begin the inquiry was issued to SHEIN Ireland at the end of April. The case comes as data transfers to China face growing regulatory scrutiny in Europe, including through recent DPC enforcement action and complaints filed with other European supervisory authorities.

Deputy Commissioner Graham Doyle said: ‘When an individual’s personal data is transferred to a country outside the E U, the GDPR requires that this personal data is afforded essentially the same protections as it would within the EU.’

He added: ‘Recent regulatory action by the DPC, together with complaints to other European supervisory authorities, has brought data transfers to China, in particular, into focus. The inquiry is an important strategic priority for the DPC and we intend to cooperate closely with our peer European Supervisory Authorities as part of the investigation.’

Under the GDPR, transfers of personal data outside the EU and EEA must meet specific safeguards so that the level of protection provided under EU law is not undermined. Where no European Commission adequacy decision exists for a third country, organisations must rely on alternative mechanisms, such as standard contractual clauses, and demonstrate that equivalent protections are in place.

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AI cyber capabilities raise risk of correlated financial system failures, IMF warns

AI is rapidly reshaping the global financial system’s cyber risk landscape, according to analysis associated with the International Monetary Fund. While AI improves defence, it also helps attackers find and exploit vulnerabilities more quickly, increasing the risk of systemic disruption.

Financial infrastructure is highly interconnected, relying on shared software, cloud services, and payment networks. IMF analysis suggests that AI-enabled cyberattacks could trigger correlated institutional failures, leading to funding stress, solvency risks, and disruptions to payments and market operations.

Recent developments in advanced AI models demonstrate how quickly offensive capabilities are evolving, with systems now able to identify weaknesses across widely used platforms.

At the same time, defensive AI tools are being deployed to detect threats and strengthen resilience, but their effectiveness depends on governance, oversight, and integration within financial institutions.

Authorities are now being urged to treat cyber risk as a core financial stability issue rather than a purely technical challenge. Stronger supervision, resilience standards, and international coordination are viewed as essential, particularly as cyber threats increasingly cross borders and exploit shared global infrastructure.

Why does it matter?

Cyber risks related to AI are a macroeconomic threat that can affect liquidity, confidence, and core financial intermediation. At the same time, the same technology is essential for defence, meaning resilience now depends on how quickly supervision, governance, and international coordination can keep pace with rapidly scaling offensive capabilities.

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Instagram pulls the plug on encrypted chats

Instagram will no longer support end-to-end encrypted chats from 8 May 2026, ending an optional privacy feature for some direct messages on the platform.

Users affected by the change are being prompted to download any messages or media from encrypted chats that they wish to keep before the feature is removed. Instagram’s help page says users may need to update the app to access or download their end-to-end encrypted chats.

End-to-end encryption allows only the people in a conversation to read messages or hear calls, with messages protected by encryption keys linked to authorised devices. On Instagram, however, encrypted chats were an optional feature rather than the default for all direct messages.

After 8 May 2026, users will no longer be able to send or receive end-to-end encrypted messages or calls on Instagram. The help page also notes that users can still report messages from encrypted chats and that shared content may still be forwarded outside an encrypted conversation.

The change marks a rollback of a privacy feature on one of Meta’s major social platforms, even as end-to-end encryption remains central to debates over secure communications, platform safety and user confidentiality.

Why does it matter?

End-to-end encryption is widely seen as a core privacy protection because it limits access to message content, including by the platform itself. Its removal from Instagram encrypted chats raises questions about how major platforms prioritise privacy features, user safety, product complexity and interoperability across their messaging services.

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Australia’s ASIC urges cyber resilience as frontier AI raises risk

The Australian Securities and Investments Commission has urged regulated entities to strengthen cyber resilience, warning that frontier AI could intensify cyber risks by exposing vulnerabilities at greater speed, scale and sophistication.

In an open letter to industry, ASIC said licensees and market participants should act now to improve their cybersecurity fundamentals rather than wait as advanced AI tools reshape the threat environment. The regulator said cyber resilience should be treated as a core licensing obligation, not solely as an IT issue.

ASIC Commissioner Simone Constant said frontier AI creates opportunities but also materially increases cyber risk, including by exposing weaknesses faster than many organisations realise. She warned that vulnerabilities once seen as isolated could have system-wide effects and enable previously out-of-reach forms of exploitation for many malicious actors.

The letter follows ASIC’s recent court outcome against FIIG Securities Limited, which the regulator said reinforced the need for cyber risk management controls to be demonstrably effective and proportionate to a business’s size, nature and complexity.

ASIC is urging entities to reassess cyber plans, identify and protect critical systems, reduce exposure to untrusted networks, review user access, patch systems promptly, strengthen incident response planning and manage third-party risks. It also says organisations should use AI defensively where appropriate, including to identify vulnerabilities and secure software before release.

Constant said entities need robust incident response plans and that the underlying principles of cyber risk management remain the same: govern, protect, detect and respond. She also said boards and executives must ensure systems are tested, weaknesses are addressed early, and action is taken before threats can be exploited.

ASIC says entities must table the letter at their ultimate board and risk governance committees. It also encourages regulated entities to use guidance from trusted sources, including the Australian Signals Directorate and the Australian Government’s Cyber Health Check.

Why does it matter?

ASIC’s warning shows that financial regulators are beginning to treat frontier AI as a force multiplier of cyber risk, not just a technology issue. By framing cyber resilience as a licensing and board-level governance obligation, the regulator is signalling that firms may be judged not only on whether they suffer cyber incidents, but on whether their controls, escalation processes and resilience planning are proportionate to an AI-accelerated threat environment.

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WEF report says AI is reshaping cybersecurity defence

Advanced AI models are reshaping cybersecurity by accelerating both offensive and defensive capabilities, forcing organisations to rethink how they detect, assess and respond to cyber threats.

A new World Economic Forum report argues that AI is becoming a defining force in cybersecurity, with organisations increasingly moving from pilot projects to operational deployment. According to the WEF, AI is already being used to improve vulnerability identification, threat detection, response speed and resilience.

The report highlights how AI can help security teams process large volumes of data, detect threats faster and support more efficient responses. At the same time, it warns that threat actors are also using AI to automate deception, generate malware and scale attacks at machine speed.

WEF’s analysis says the growing speed and scale of AI-enabled cyber operations are putting pressure on traditional cybersecurity models. Instead of relying mainly on prevention and scheduled patching cycles, organisations are being pushed towards continuous detection, automated response, stronger access controls and more resilient infrastructure.

The report also stresses that AI’s value in cybersecurity depends on strategy, governance and human oversight. Rather than treating AI as a standalone tool, organisations are encouraged to test use cases carefully, build appropriate safeguards and invest in the skills and processes needed to defend at machine speed.

Why does it matter?

AI is changing cybersecurity on both sides of the equation. It can lower the barriers for faster and more scalable attacks, but it can also help defenders improve detection, response and resilience. The wider significance is that cybersecurity strategies built around periodic assessment and manual response may become less effective as AI-driven threats and defences operate at greater speed and scale.

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EESC backs revised Cybersecurity Act with warnings on ENISA and supply chains

The European Economic and Social Committee has backed the EU’s proposed revision of the Cybersecurity Act, supporting reforms to ENISA, the cybersecurity certification framework and ICT supply-chain security, while warning that the next phase of the EU cyber policy must remain workable in practice.

In its opinion, the committee argues that cybersecurity and ICT supply-chain security should not be treated as narrow technical questions. Instead, it presents them as matters of economic security and geopolitical resilience, closely linked to the EU’s competitiveness, legal certainty and broader resilience.

The opinion welcomes the European Commission’s attempt to update the Cybersecurity Act and align related rules under NIS 2, particularly where the package aims to simplify compliance and reduce overlapping obligations. At the same time, the committee says that a stronger ENISA will require stronger backing. If the agency is expected to take on more responsibilities, those tasks should come with adequate resources, specialist staff and a mandatory workforce plan.

The committee also supports a single-entry point for incident reporting. It says parallel reporting requirements under NIS 2, DORA and sector-specific rules should be streamlined so that one comprehensive report can serve all relevant regulatory regimes.

On ICT supply-chain security, the opinion supports a structured EU framework for identifying key assets and addressing high-risk suppliers. However, it warns that restrictions and phase-outs should be transparent, proportionate and supported by realistic transition plans that account for replacement timelines, service continuity, costs, labour-market effects and the risk of shifting compliance burdens onto smaller firms outside the regulation’s scope.

The committee also calls for the cyber debate to address democratic resilience. A proposed amendment would give ENISA a clearer role in supporting election security, democratic resilience and public awareness of cyber threats, disinformation and safe digital behaviour.

Why does it matter?

The opinion supports a more centralised and strategic EU cybersecurity framework, but also highlights the practical risks of expanding cyber regulation faster than institutions and companies can implement it. The debate around ENISA’s mandate, incident reporting and ICT supply-chain restrictions will shape how far the EU can strengthen cyber resilience without creating fragmented obligations or disproportionate burdens for smaller firms.

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The rise of gray websites fuels global scam and data theft risks

Cybersecurity researchers at Kaspersky have identified a growing network of so-called ‘grey’ websites that exploit user trust to generate financial gain and harvest personal data. Unlike traditional phishing attacks, these platforms rely on manipulation, misleading design and hidden conditions rather than direct credential theft.

The report shows that gray websites often imitate legitimate services, including financial tools, e-commerce platforms, AI services and subscription-based content.

Common categories include fake browser extensions, fraudulent investment schemes, subscription traps and counterfeit online shops, many of which are designed to encourage voluntary payment or data sharing.

Kaspersky notes that these threats are spreading globally but vary by region.

Europe is seeing a rise in fake privacy tools and browser hijackers, Africa is heavily affected by fraudulent trading platforms, while Latin America faces betting scams and pyramid schemes. Asia-Pacific shows a broader mix, including crypto fraud, AI-themed scams and malicious download services.

Across all regions, attackers are increasingly aligning scams with current digital trends to appear more credible. Kaspersky warns that even well-designed platforms can hide risks, making user awareness, verification and security tools key to reducing financial and data harm.

Why does it matter?

The rise of ‘grey’ websites signals a shift in online fraud away from obvious phishing towards more subtle, trust-based manipulation. Instead of breaking systems, attackers increasingly exploit user behaviour, interfaces, and familiarity with digital services.

That lowers the ‘visibility’ of fraud. Users are not being forced into breaches; they are being guided into consent- signing up, subscribing, investing, or installing tools that appear legitimate. It makes scams harder to detect, harder to regulate, and easier to scale globally.

It also shows how cybercrime is adapting to current technological trends, especially AI services, crypto tools, and digital platforms that people already expect to be trustworthy. As a result, the boundary between legitimate innovation and fraud becomes less clear, increasing systemic risk for both consumers and digital economies.

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Rising data centre demand increases energy and cyber risks

Data centres are increasingly central to digital economies, but their rapid expansion is reshaping both electricity demand and cybersecurity risks. According to the International Energy Agency, data centres used about 1.5% of global electricity in 2024, with demand rising as AI and cloud services expand.

These facilities operate as both energy consumers and producers, relying on grid power while also maintaining on-site generation and battery systems. Their ability to switch power sources instantly supports service continuity but can also cause sudden load shifts that challenge grid stability during outages or cyber incidents.

Cybersecurity is now closely tied to energy resilience. Data centres depend on interconnected systems such as backup power, cooling, and digital control networks, all of which require continuous monitoring and protection.

Weaknesses in any part of this ‘system of systems’ can affect both service availability and wider electricity infrastructure.

Why does it matter?

Data centres are becoming a critical infrastructure that directly affects both digital services and electricity systems. Shared planning for power disruptions, cyber events, and load management is increasingly seen as necessary to ensure stability across both digital services and national energy systems.

Their rising energy demand and reliance on complex on-site and grid power arrangements mean disruptions or cyber incidents can have wider knock-on effects, making resilience and cross-sector coordination essential for overall system stability.

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ENISA to host 2026 telecom and digital infrastructure security forum

The European Union Agency for Cybersecurity (ENISA) has announced its Telecom and Digital Infrastructure Security Forum 2026, bringing together telecom experts, policymakers and national authorities to address emerging cybersecurity risks.

The forum will focus on challenges, including cyberattacks on telecom networks, resilience issues such as power dependencies, and the security implications of new technologies. It aims to support strategic and technical dialogue across the sector.

Organised with the Cyprus Presidency of the Council of the EU, the event provides a private setting for collaboration among industry specialists, regulators and the wider cybersecurity community, without public broadcasting.

Discussions will contribute to ongoing efforts to strengthen coordinated telecom security measures and policy development across the EU, with the event taking place in Nicosia, Cyprus.

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Ireland and the EU intensify DSA pressure on Meta

Coimisiún na Meán, the media regulator of Ireland, has launched two formal investigations into Meta over the design of recommender systems on Facebook and Instagram under the Digital Services Act. The investigations focus on whether users are prevented from choosing recommendation feeds that are not based on the profiling of their personal data.

Coimisiún na Meán said concerns emerged following platform supervision reviews and complaints linked to potential ‘dark patterns’ and deceptive interface designs. Regulators are examining whether users can easily access and modify non-profiled recommendation feeds as required under Article 27 of the DSA, alongside whether interface designs may improperly influence user choices under Article 25.

John Evans, Digital Services Commissioner at Coimisiún na Meán, said recommender systems can repeatedly push harmful material into user feeds, particularly affecting children and younger users. The regulator also warned that Very Large Online Platforms (VLOPs) must ensure users can exercise their rights under the DSA without manipulation or unnecessary barriers.

EU investigates Meta over under-13 access on Instagram and Facebook

At the same time, the European Commission has preliminarily found Meta in potential breach of the DSA over failures to adequately prevent children under 13 from accessing Instagram and Facebook. Regulators said Meta’s age verification and reporting systems may be ineffective, while the company’s risk assessments allegedly failed to properly address harms faced by underage users.

Why does it matter?

These investigations are critical because they could shape how the DSA is enforced across Europe, particularly in cases involving children and algorithmic recommendation systems. If regulators conclude that Meta failed to properly protect minors or used manipulative interface designs that discouraged users from choosing non-profiled feeds, the case may set a wider precedent for how large online platforms handle age assurance, user consent, privacy protections, and recommender system transparency under EU law.

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