Imagine this: you’re a team member in the IT Department at a well-known retail giant, and you’re suddenly told to stay overnight at the office — not for a team-building exercise, but because of a major cyber incident. You’re cut off from critical systems, communication is in disarray, and paranoia is spreading faster than malware. Sound dramatic? This was the recent reality at Marks & Spencer, as revealed by a whistleblower in Sky News’ exposé on their apparent lack of cyber preparedness.

While M&S grapples with reputational fallout, businesses in the financial services sector — especially those involved in consumer credit — should be paying very close attention. Here’s why.

1. Cyber Attacks Aren’t a Tech Problem — They’re a Business Problem

It’s tempting to think of cyber threats as something for the IT department to handle. But when a breach occurs, the fallout doesn’t stop at server rooms — it hits customer trust, regulatory standing, and even business continuity.

In consumer credit, where trust and compliance are everything, a single breach can undo years of brand building and expose your business to costly enforcement action and potentially destroy your whole business. It’s not just about protecting data — it’s about safeguarding livelihoods, including your own.

2. The Cost of Complacency Is Measured in Chaos

According to the insider report, M&S had no real incident response plan — leading to confusion, long nights, and ultimately, a loss of internal confidence, never mind the impact on how its consumers feel about what has happened. For regulated financial firms, such a scenario would almost certainly draw scrutiny from the Financial Conduct Authority (FCA) and possibly the Information Commissioner’s Office (ICO).

Would your firm know what to do if:

• Client account data was suddenly exposed?
• Your payment processing system was frozen by ransomware?
• A phishing attack gave criminals access to sensitive communications?

If your answer is “not sure,” it’s time for a plan.

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3. The FCA Is Watching – and So Are Your Clients

The FCA’s expectations around Operational Resilience and Cybersecurity are crystal clear. Regulated firms are expected to:

• Identify critical, important and essential important business services, processes and operations;
• Test your systems and processes for vulnerabilities;
• Have robust response and recovery plans, test them and integrate them into your development functions, activity and deployments;
• Demonstrate clear oversight, involvement and understanding from senior management.

In short: the “we didn’t expect it” excuse simply will not fly. And in a sector where consumer data is king, your clients demand the same high standards.

4. Practical Steps to Get Ahead of a Cyber Crisis

Let the M&S story be a wake-up call — not a warning shot that goes ignored. Here’s how to start:

• Audit your systems and 3rd parties — Understand where your data is stored, who has access, and what third-party risks exist.
• Build (and test) an incident response plan — Include all departments — Development, Operations, Compliance, IT, Marketing, Customer Service — and simulate real-world scenarios from light touch outages to whole-scale problems.
• Train and educate your staff — regularly — Phishing, social engineering, and weak passwords are still the top causes of breaches. Human error is preventable.
• Create your systems and backend systems in a manner which has data and protection at the heart of everything you create and patch–test not just the operational deployment v requirements but the actual code with a sceptical and problem-oriented mindset.
• Stay up to date with regulations — GDPR, the FCA’s Cyber Resilience Guidance, and the Consumer Duty all touch on data and operational integrity.
• Appoint a cyber lead or virtual CISO — Even if you’re a small firm, someone must own the cyber risk register, review it on a regular basis and stay abreast of company development and how this could pose potential issues. Operations and Development functions have to stay close, understanding each other’s projects, planning and issues, and work together to when it comes to deployment for the benefit of the customer and business.

5. Final Thoughts: Be Proactive, Not Paranoid

M&S’s reported situation, described as “chaos and paranoia”, reflects what happens when cybersecurity is treated as an afterthought. In financial services, that’s not just a misstep – It’s a breach of your obligations and duty.

Whether you’re a mortgage broker, consumer lender, or fintech innovator, one thing is certain: Cybersecurity is not optional. It’s a core pillar of resilience, trust, and long-term success.

If you don’t already have a cyber strategy tailored to the unique demands of consumer credit, now is the time to act. Need help building a robust, compliant framework? Get in touch — before it’s your staff sleeping in the office and having that knock on the door from a journalist, a regulator or seeing your customers leaving or not returning in their droves.

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With all the regulatory shifts on the horizon, now is the time to act. Don’t wait until compliance gaps appear—engage with ALPH Legal today to ensure your firm is ahead of the curve. Whether you need tailored guidance, compliance support, or strategic insights to drive new business, ALPH Legal is your trusted partner in navigating FCA regulations with confidence. 

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