Powell Flags Cybersecurity as Geopolitical Risks Escalate
Federal Reserve Chair Jerome Powell issued a direct warning on Tuesday about the risk of cyberattacks from Iran in the wake of recent U.S. military strikes on the country’s nuclear facilities. Speaking before Congress, Powell said the central bank had intensified its cybersecurity posture and was working closely with other federal agencies and the financial sector.
"We’re on the alert because we’re a target as well. So you’re right to raise it. It’s a big issue." — Jerome Powell, Chair, Federal Reserve
Powell confirmed that the Fed had been in active contact with regulatory bodies and national security agencies, urging private banks to remain on high alert for potential breaches. While no cyber incidents had yet been reported, Powell emphasized the seriousness of the threat.
Financial Institutions Brace for Digital Retaliation
U.S. authorities have warned that Iran or its allied groups could retaliate against the United States through cyber means, particularly by targeting critical financial and digital infrastructure. The Department of Homeland Security has already alerted businesses, with banks considered particularly vulnerable.
Although military tensions have momentarily cooled following a ceasefire agreement announced by President Donald Trump, the risk of cyber retaliation remains top of mind. On Monday, Iran launched missile strikes at a U.S. base in Qatar, which were successfully intercepted by American defense systems.
Despite the ceasefire, Trump criticized both Israel and Iran for actions he claimed violated the truce.
"I’m not happy with Israel. Not happy with Iran, either." — President Donald Trump
Long History of Iranian Cyber Intrusions
Iran’s use of cyberwarfare is not new. In 2024, the U.S. Treasury sanctioned two Iranian tech firms and four individuals for collaborating with the Islamic Revolutionary Guard Corps’ cyber unit in a series of phishing and malware operations against American targets. The Justice Department charged the four individuals for orchestrating attacks that compromised over 200,000 U.S. employee email accounts.
The Islamic Republic’s cyber activities date back more than a decade. In 2016, the FBI indicted seven Iranians linked to government-sponsored cyberattacks targeting nearly 50 U.S. financial institutions between 2011 and 2013. Their efforts included a failed attempt to breach control systems at a dam in New York.
Fed Emphasizes Vigilance, Not Complacency
Despite assurances that the Federal Reserve and major banks possess robust cyber defenses, Powell made it clear that the evolving nature of cyber threats means constant vigilance is essential.
"You can never, ever be comfortable in this area because the bad guys are always getting better." — Jerome Powell, Chair, Federal Reserve
As geopolitical tensions continue to ripple through financial systems, the Federal Reserve’s proactive cybersecurity stance underscores the increasing overlap between global conflict and digital vulnerability.
Source: Fortune, June 24, 2025.
