Security only at layer 7 and above?

I recently had a friend who works for an unamed evil empire disclose to me that he and his colleagues are under the assumption that security is no longer an issue in any layer below 7. I'm going to keep this vaque, but I'm interested to hear the various thoughts from others on this matter. I don't think the day of the network attack will ever subside completely, but are the days of Layer 3 attack detection long gone?