Published Date: 2015-05-20
| Postmortem Analysis | |
|---|---|
| Timeline | 1. The software failure incident happened on April 23, 2013 [36247, 18517, 18300, 18096]. |
| System | 1. Trading algorithms relied on by financial organizations [36247, 18517, 18300, 18096] 2. Social media data integration with financial algorithms [36247, 18517, 18300, 18096] 3. Lack of verification mechanisms for social media content [36247, 18517, 18300, 18096] 4. Automated electronic trading systems [18517, 18300, 18096] 5. Lack of human intervention in trading decisions [18517, 18300, 18096] |
| Responsible Organization | 1. Syrian Electronic Army - Claimed responsibility for hacking the Associated Press Twitter account and sending out false tweets about explosions at the White House, leading to a stock market crash [36247, 18517, 18300, 18096] 2. Exposed - Linked to a separate hoax involving a 911 bomb threat directed at the White House [18096] |
| Impacted Organization | 1. Associated Press [36247, 18517, 18300, 18096] 2. Financial markets (Dow Jones Industrial Average, Standard & Poor's 500 Index) [36247, 18517, 18300, 18096] 3. High-frequency traders using algorithms [36247, 18517, 18300, 18096] 4. Twitter [18300, 18096] 5. U.S. financial markets [18300] 6. Bloomberg [18300] 7. New York Stock Exchange [18517, 18096] |
| Software Causes | 1. The software failure incident was caused by a false tweet sent from a hacked Associated Press (AP) Twitter account, leading to a stock market crash due to the rapid response of financial trading algorithms [36247, 18517, 18300, 18096]. 2. Sophisticated algorithms designed to identify and evaluate Internet content that could influence markets launched a panicked trading spree, executing thousands of trades per second based on the false information from the tweet [36247, 18517, 18300, 18096]. 3. The incident highlighted the heavy reliance of financial organizations on trading algorithms, which can lead to unpredictable consequences in the future when reacting to false information spread through social media [36247, 18517, 18300, 18096]. |
| Non-software Causes | 1. Phishing attempt on the corporate network of the Associated Press, leading to the hacking of their Twitter account [18300, 18096] 2. False report by hackers claiming explosions at the White House and injury to President Barack Obama, leading to panic in the financial markets [18517, 18096] 3. Lack of timely clarification from the White House and AP after the false tweet was sent out, causing further confusion and panic in the markets [18517] |
| Impacts | 1. The false tweet from the hacked Associated Press (AP) Twitter account caused a massive stock crash, with the Dow Jones Industrial Average dropping 143.5 points and the Standard & Poor's 500 Index losing over $136 billion in value in a matter of seconds [36247, 18517, 18300, 18096]. 2. The tweet led to panic among traders, high trading volumes on the New York Stock Exchange, and a rapid plunge and recovery in the stock market indices [18517, 18300, 18096]. 3. The incident highlighted the heavy reliance of financial organizations on trading algorithms, which executed thousands of trades per second based on the false information, showcasing the potential unpredictable consequences of such systems [36247, 18517, 18300, 18096]. 4. The false tweet briefly wiped out $136.5 billion of the S&P 500 index's value before markets recovered, and some traders attributed the sharp fall and recovery to automatic electronic trading [18300, 18096]. 5. The incident raised concerns about the impact of false information spread through social media on financial markets and the need for better understanding of the link between social media data and decision-making processes in the private and public sectors [36247, 18517, 18300, 18096]. |
| Preventions | 1. Implementing stronger password security measures for social media accounts, such as using complex passwords and enabling two-factor authentication [18300, 18300]. 2. Enhancing cybersecurity measures to prevent phishing attempts on corporate networks, which could lead to unauthorized access to social media accounts [18300, 18300]. 3. Conducting regular cybersecurity training for employees to raise awareness about potential threats like hacking and phishing attacks [18300, 18300]. 4. Developing algorithms that can better differentiate between credible and false information on social media to prevent automated trading based on inaccurate data [36247, 18517]. 5. Increasing transparency and understanding of financial algorithms used for high-frequency trading to ensure they operate in a responsible and accurate manner [36247, 18517]. |
| Fixes | 1. Implementing stronger password security measures to prevent unauthorized access to social media accounts [18300, 18096]. 2. Introducing two-factor authentication for social media accounts to enhance security and reduce the risk of breaches [18300]. 3. Conducting regular cybersecurity training for employees to prevent phishing attempts and improve overall network security [18096]. 4. Enhancing monitoring and verification processes for news dissemination on social media platforms to quickly identify and address false information [18300]. 5. Increasing awareness among traders and financial organizations about the risks associated with relying too heavily on automated trading algorithms [18517, 18096]. | References | 1. Associated Press (AP) Twitter account [36247, 18517, 18300, 18096] 2. White House [36247, 18517, 18300, 18096] 3. Financial markets (Dow Jones Industrial Average, Standard & Poor's 500 Index) [36247, 18517, 18300, 18096] 4. Experts and analysts [36247, 18517, 18300, 18096] 5. Syrian Electronic Army [18517, 18096] 6. FBI [18300] 7. U.S. Securities and Exchange Commission (SEC) [18300] 8. Twitter [18300] 9. Security experts [18300] 10. Traders and trading directors [18517, 18096] 11. White House Press Secretary [18517, 18300] 12. Bloomberg [18517, 18096] 13. Lawmakers [18300] 14. Democratic Senator Jack Reed [18300] 15. Reuters [18300] |
| Category | Option | Rationale |
|---|---|---|
| Recurring | one_organization, multiple_organization | (a) The software failure incident having happened again at one_organization: - The Associated Press (AP) Twitter account was hacked in 2013, leading to a false tweet about explosions at the White House and President Barack Obama being injured, causing a significant stock market crash [36247, 18517, 18300, 18096]. (b) The software failure incident having happened again at multiple_organization: - The Syrian Electronic Army, a group of hackers, claimed responsibility for hacking the AP Twitter account in 2013. They have also been linked to other hacking incidents targeting various organizations, including FIFA, BBC, and Reuters News [18517, 18096]. |
| Phase (Design/Operation) | design, operation | (a) The software failure incident related to the design phase: - The incident was caused by a false tweet from a hacked Associated Press (AP) Twitter account, leading to a stock market crash due to trading algorithms reacting to the fake news [36247, 18517, 18300, 18096]. - Sophisticated algorithms designed to identify and evaluate Internet content that could influence markets launched a panicked trading spree based on the assumed gravity of the false social media posting [36247]. - The incident highlighted the need to better understand how social media data is linked to decision-making in the private and public sector, emphasizing the connection between social media, the market, and algorithms [36247, 18517, 18300, 18096]. (b) The software failure incident related to the operation phase: - Traders blamed automatic electronic trading for the sharp fall and recovery in the markets, indicating that algorithms reacted to the false information disseminated on social media [18517, 18300, 18096]. - The incident demonstrated the impact of technology and communications on market reactions, showing how easily communications can be misconstrued and hacked, leading to market disruptions [18517, 18300, 18096]. - The incident raised concerns about the increasing dependence on technology for communications and the potential risks associated with false information being spread and capitalized on [18517, 18300, 18096]. |
| Boundary (Internal/External) | within_system, outside_system | (a) within_system: The software failure incident was primarily caused by factors originating from within the system. The incident involved a false tweet sent from a hacked Associated Press (AP) Twitter account, which led to a significant stock market crash. Sophisticated algorithms designed to identify and evaluate Internet content that could influence markets reacted to the false tweet by launching a panicked trading spree, executing thousands of trades per second based on the assumed gravity of the social media posting [36247, 18517, 18300, 18096]. (b) outside_system: The incident was triggered by external factors, specifically, hackers gaining control of the AP Twitter account and sending out a false tweet about explosions at the White House. This external intrusion led to the dissemination of false information that caused the stock market crash. The Syrian Electronic Army claimed responsibility for the hack, indicating an external threat to the system [18517, 18096]. |
| Nature (Human/Non-human) | non-human_actions, human_actions | (a) The software failure incident occurring due to non-human actions: - The incident, known as the "Hack Crash," was initiated by sophisticated algorithms designed to identify and evaluate Internet content that could influence markets. These algorithms launched a panicked trading spree, executing thousands of trades per second based on the false tweet about explosions at the White House sent from the Associated Press's hacked Twitter account [36247]. - The false tweet caused a plunge in the Dow Jones Industrial Average and the Standard & Poor's 500 Index, wiping out billions of dollars in value in a matter of seconds. This rapid market reaction was driven by financial algorithms that operate autonomously and faster than human thought, responding to uncertainties and probabilities implied by the fake news [18517]. - The incident highlighted the heavy reliance of financial organizations on trading algorithms, which can lead to unpredictable consequences in the future. The algorithms, designed to identify and evaluate Internet content that could influence markets, executed trades at a rapid pace based on the assumed gravity of the false social media posting [18300]. - The sharp fall and subsequent recovery in the markets were attributed to automatic electronic trading programs reacting to the false information disseminated through the hacked AP Twitter account. Traders noted that only computers reacted to the serious news in such a way, emphasizing the role of non-human factors in the market disruption [18096]. (b) The software failure incident occurring due to human actions: - The incident was caused by a group of Syrian hackers who claimed responsibility for hacking the Associated Press's Twitter account and posting a false report about explosions at the White House, leading to a temporary plunge in the financial markets. The hackers infiltrated the AP account and sent out the misleading tweet, which was retweeted thousands of times before the truth was revealed [18517]. - The false tweet about explosions at the White House, sent from the hacked AP Twitter account, was a result of human actions by the Syrian Electronic Army, a group supportive of Syrian leader Bashar al-Assad. The group claimed responsibility for the hack, highlighting the role of human actors in initiating the software failure incident [18096]. |
| Dimension (Hardware/Software) | software | (a) The software failure incident occurring due to hardware: - There is no specific mention of the software failure incident occurring due to contributing factors originating in hardware in the provided articles. (b) The software failure incident occurring due to software: - The software failure incident in the articles is primarily attributed to a false tweet sent from a hacked Associated Press (AP) Twitter account, leading to a stock market crash. The incident involved hackers infiltrating the account and sending out a false tweet about explosions at the White House, which triggered trading algorithms to execute trades rapidly, causing market turmoil [36247, 18517, 18300, 18096]. - The incident highlighted the heavy reliance of financial organizations on trading algorithms, which responded to the false information spread through social media [36247, 18517, 18300, 18096]. - Experts warned about the unpredictable consequences of such incidents in the future, emphasizing the need to understand the link between social media data and decision-making in finance [36247, 18517, 18300, 18096]. - The false tweet led to a significant drop in the Dow Jones Industrial Average and the Standard & Poor's 500 Index, wiping out billions of dollars in value before the markets corrected themselves [36247, 18517, 18300, 18096]. - The incident also raised concerns about the impact of high-frequency trading algorithms that react to social media feeds, highlighting the challenges of algorithmic trading based on speed and proprietary nature [36247, 18517, 18300, 18096]. - The software failure incident was a result of the false tweet spreading rapidly through social media, demonstrating the potential risks associated with the intersection of social media, market algorithms, and decision-making processes [36247, 18517, 18300, 18096]. |
| Objective (Malicious/Non-malicious) | malicious, non-malicious | (a) The software failure incident was malicious, as it was caused by hackers who infiltrated the Associated Press's Twitter account and sent out a false tweet about explosions at the White House, leading to a significant stock market crash [36247, 18517, 18300, 18096]. (b) The incident involved non-malicious contributing factors such as the heavy reliance on trading algorithms by financial organizations, which reacted to the false tweet and caused market disruptions [36247, 18517, 18300, 18096]. |
| Intent (Poor/Accidental Decisions) | poor_decisions | (a) poor_decisions: The software failure incident involving the false tweet from the hacked Associated Press (AP) Twitter account leading to a stock market crash was primarily due to poor decisions made by financial organizations relying heavily on trading algorithms. The incident demonstrated how algorithms designed to identify and evaluate Internet content that could influence markets reacted in a panicked manner to the false tweet, causing a significant market disruption [36247, 18517, 18300, 18096]. (b) accidental_decisions: The software failure incident was not primarily due to accidental decisions or unintended mistakes. Instead, it was driven by deliberate actions of hackers who infiltrated the AP Twitter account and posted a false report about explosions at the White House, leading to the market turmoil. The incident was a result of intentional hacking rather than accidental decisions [36247, 18517, 18300, 18096]. |
| Capability (Incompetence/Accidental) | development_incompetence | (a) The software failure incident occurring due to development_incompetence: - The incident of the false tweet causing a stock market crash was a result of hackers infiltrating the Associated Press's Twitter account and sending out a false tweet about explosions at the White House, leading to panic in the financial markets [36247, 18517, 18300, 18096]. - Experts highlighted that financial organizations rely heavily on trading algorithms, which led to a panicked trading spree triggered by the false tweet, showcasing a lack of understanding of how social media data is linked to decision-making in the private and public sectors [36247, 18517, 18300, 18096]. (b) The software failure incident occurring due to accidental factors: - The incident was not accidental but rather a deliberate hack by the Syrian Electronic Army, a group of hackers claiming responsibility for the false tweet sent from the AP's Twitter account [18517, 18300, 18096]. - The false tweet was a deliberate act of hacking, causing chaos in the financial markets, and was not accidental in nature [18517, 18300, 18096]. |
| Duration | temporary | (a) The software failure incident in the articles was temporary. The incident was caused by a false tweet sent from a hacked Associated Press (AP) Twitter account, which falsely reported explosions at the White House and an injury to President Barack Obama. This false information led to a rapid and significant drop in the Dow Jones Industrial Average and the Standard & Poor's 500 Index, wiping out billions of dollars in value. However, once the nature of the tweet was discovered and clarified, the markets corrected themselves quickly [36247, 18517, 18300, 18096]. |
| Behaviour | crash, omission, timing, value | (a) crash: The software failure incident can be categorized as a crash as the system lost its state and did not perform its intended functions. The false tweet from the hacked Associated Press (AP) Twitter account caused a flash crash in the financial markets, with the Dow Jones Industrial Average dropping 143.5 points and the Standard & Poor's 500 Index losing more than $136 billion in value in a matter of seconds [36247]. (b) omission: The software failure incident can also be categorized as an omission as the system omitted to perform its intended functions at an instance. The false tweet about explosions at the White House and President Barack Obama being injured led to panic and a sharp fall in the markets before it was revealed to be a hack, causing the markets to correct themselves [18517]. (d) value: The software failure incident can be categorized as a value failure as the system performed its intended functions incorrectly. The false tweet caused a momentary wipeout of $136.5 billion of the S&P 500 index's value before the markets recovered [18300]. (e) byzantine: The software failure incident does not align with a byzantine failure, which involves the system behaving erroneously with inconsistent responses and interactions. The incident primarily involved a false tweet causing a market crash due to the assumed gravity of the information, rather than inconsistent responses or interactions [unknown]. (f) other: The software failure incident can be categorized as a timing failure. The system performed its intended functions correctly, but the timing was crucial as the false tweet led to immediate and significant market reactions before the correction occurred [18096]. |
| Layer | Option | Rationale |
|---|---|---|
| Perception | None | None |
| Communication | None | None |
| Application | None | None |
| Category | Option | Rationale |
|---|---|---|
| Consequence | property, non-human, theoretical_consequence | (d) property: People's material goods, money, or data was impacted due to the software failure The software failure incident involving the false tweet from the hacked Associated Press (AP) Twitter account caused a significant impact on financial markets. The Dow Jones Industrial Average dropped 143.5 points, and the Standard & Poor's 500 Index lost more than $136 billion of its value in the seconds following the false tweet [36247, 18517, 18300, 18096]. Traders experienced panic and chaos, with billions of dollars in market value being wiped out temporarily before recovering [18517, 18300, 18096]. The incident highlighted the heavy reliance of financial organizations on trading algorithms, which led to unpredictable consequences in the market due to the false information spread through social media [36247, 18517, 18300, 18096]. |
| Domain | information, finance, government | (a) The failed system was intended to support the information industry, specifically in the context of news dissemination and social media impact on financial markets. The incident involved a false tweet from the Associated Press's hacked Twitter account causing a significant stock market crash due to the rapid spread of misinformation [36247, 18517, 18300, 18096]. (h) The incident also directly impacted the finance industry, as the false tweet led to a plunge in the Dow Jones Industrial Average and the Standard & Poor's 500 Index, resulting in the loss of billions of dollars in market value. The event highlighted the heavy reliance of financial organizations on trading algorithms, which executed trades based on the false information [36247, 18517, 18300, 18096]. (l) Additionally, the government sector was involved as the false tweet reported explosions at the White House and an injury to President Barack Obama, leading to a brief period of chaos and panic in the financial markets. The White House had to quickly clarify the situation to reassure the public and stabilize the markets [36247, 18517, 18300, 18096]. |
Article ID: 36247
Article ID: 18517
Article ID: 18300
Article ID: 18096