July 8, 2014 - Wall Street's biggest trade group has proposed a government-industry cyber war council to stave off terrorist attacks that could trigger financial panic by temporarily wiping out account balances, according to an internal document.

The proposal by the Securities Industry and Financial Market Association, known as Sifma, calls for a committee of executives and deputy-level representatives from at least eight U.S. agencies including the Treasury Department, the National Security Agency and the Department of Homeland Security, all led by a senior White House official.

The trade association also reveals in the document that Sifma has retained former NSA director Keith Alexander to "facilitate" the joint effort with the government. Alexander, in turn, has brought in Michael Chertoff, the former Secretary of Homeland Security, and his firm, Chertoff Group.

The document sketches an unusually frank and pessimistic view by the industry of its readiness for attacks wielded by nation-states or terrorist groups that aim to "destroy data and machines." It says the concerns are "compounded by the dependence of financial institutions on the electric grid," which is also vulnerable to physical and cyber attack.

"The systemic consequences could well be devastating for the economy as the resulting loss of confidence in the security of individual and corporate savings and assets could trigger widespread runs on financial institutions that likely would extend well beyond the directly impacted banks, securities firms and asset managers," Sifma wrote in the document, dated June 27.

Liz Pierce, a spokesman for Sifma, declined to comment on the document, adding that the group "is doing everything possible to help the industry prepare for and defend against cyberattacks." Caitlin Hayden, spokeswoman for the White House National Security Council, declined to comment.