More businesses classify as financial services organizations today than ever before thanks to technology. This is because financial services organizations use financial technology—or fintech—to improve business operations and provide convenience for consumers. Conversely, the high-speed exchange of personal information and financial data makes it very convenient for cyberattackers to go where the money is without walking through the front door of a financial institution. Accordingly, financial cybersecurity is more important than ever.
Best Practices for Financial Services Organizations
Cybersecurity remains the focal point for financial services organizations regarding data loss prevention and consumer confidence. There are few types of personal data that consumers are more cautious with sharing than their financial information, so the service providers handling it must be especially concerned with security. Furthermore, breaches likely result in significant fines beyond reputational losses.
To enhance protections, the following best practices should be incorporated into your financial services cybersecurity program:
- Implement an enterprise security framework
- Create a culture fostering cybersecurity
- Threat monitoring
- Vulnerability management
- Third-party risk management
- Backup data
- Incident response
To implement these financial cybersecurity practices, consider partnering with an expert managed security services provider (MSSP) for program advisory. Additionally, you should consider earning a SOC 2 certification to readily demonstrate robust data protection efforts.
The Need for Financial Cybersecurity
A 2021 report released by the Congressional Research Service states that the impact of cybercrime on the financial sector two years prior averaged over $18 million in losses per organization. This figure is roughly 40 percent higher than the average loss—$13 million—in other sectors.
Following financial cybersecurity best practices can help ensure continuous data security when providing services. They protect your organization from operational risk (i.e., your ability to process transactions) and reputational risk (i.e., consumer confidence in your ability to safeguard their information).
Implement an Enterprise Security Framework
As a financial services organization, you should be intimately familiar with the regulations governing information security. When establishing your enterprise security framework, you should align your business needs with compliance obligations.
If you’re looking to streamline compliance efforts under a unified framework, consider HITRUST certification. Although the HITRUST CSF was initially designed for the healthcare industry, the controls have since expanded to cover numerous regulations.
Your enterprise security framework should also enforce self-assessment. One example of conducting self-assessments is outlined by the National Institute of Standards and Technology’s (NIST) Special Publication 800-53.
NIST SP 800-53: Program Self-Assessment
Among the many guidance materials published by NIST, SP 800-53—Security and Privacy Controls for Information Systems and Organizations—informs risk management policies and procedures that financial services organizations should adopt. It contains 20 control families to help organizations construct a cybersecurity program.
The advisory is designed to provide comprehensive and flexible controls to ensure data security and privacy regardless of evolving threats, vulnerabilities, requirements, and technologies.
As outlined in SP 800-53, your organization should self-assess according to these questions:
- What security and privacy controls are stipulated by applicable compliance regulations and requirements for managing risks to the organization or individuals?
- How complete is the implementation of these stipulated controls?
- If incomplete, what plans are in place to finish implementing them?
- What criteria have been established and documented for determining the stipulated controls have been fully implemented and evaluating their efficacy?
- How often are controls reevaluated?
Create a Cybersecurity Culture
To compliment your robust enterprise security architecture, you need to create a culture with cybersecurity blended into the social and operational norms of the organization. While championed by chief information security officers (CISO) and other IT roles, the mentality must pervade your entire organization. Financial services executives have to push cybersecurity across all departments as a business initiative to maintain compliance and protect growth.
- The top patterns for all breach incidents—Web Application Attacks, Miscellaneous Errors, and Social Engineering—increased from 72 percent in 2019 to 81 percent in 2021
- Internal threat actors causing breaches surged by 22 percent (36 percent in 2019 compared to 44 percent in 2021)
Social engineering, process errors, and privilege misuse are crucial areas to focus your cybersecurity training and awareness program to address insider threats.
Financial cybersecurity would not be complete without continuous threat monitoring. Managed detection gives you the best chance to identify network threats and anomalies that are triggered notifications about suspicious activity and overt attacks (e.g., ransomware).
With threat monitoring protecting information security, financial services organizations are capable of:
- Viewing and capturing network performance in real-time
- Showing regulatory compliance by monitoring systems that process and store financial data
- Measuring the effectiveness of your cybersecurity policies
A financial services cybersecurity program requires a mechanism to evaluate your security posture efficacy periodically. Vulnerability assessments provide snapshots of the potential weakness in your enterprise architecture.
Procuring new hardware, expanding storage to the cloud, remote access to the network, internet of things (IoT) devices, and new web applications are all great resources for business growth.
However, these same resources increase the attack surface of your organization. Therefore, you need to scan your network to find and eliminate vulnerabilities to protect financial data.
Threat and vulnerability management helps improve regulatory compliance and reduce both operational and reputational risk.
Third-Party Risk Management
Aside from connecting to customers, financial service organizations use various partners, suppliers, and vendors to process critical business functions. All of these third parties present security risks. Leveraging these connections (i.e., supply chain attack) is a common technique for compromising data security in financial services.
Before you put your business and reputation at risk, consider the following actions when selecting third-party expertise:
- Vendor assessment – Examine how your data is protected under vendor control
- Regulatory compliance – Ensure your vendor security and privacy controls do not put your data at risk by securing a service level agreement (SLA)
- Implement a policy — Audit your vendor’s information security posture periodically
Financial services cybersecurity should include backing up critical data to effectively minimize data loss due to human error, natural disaster, or a ransomware attack.
Consider these best practices for your data backup process:
- Communicate the necessity and intent of your backup
- Explain the expectations of employee participation
- Select an individual or team responsible for managing and maintaining the backup plan
- Consider what information requires data backup
- Establish policies specifying the frequency, protection, and location for backing up data
Whether you choose physical drives, portable devices, or cloud solutions, regularly evaluate your backups and enforce “separation of duties” to minimize insider threat to business recovery.
With financial gain as the motive 96 percent of the time for threat actors, it’s likely your financial services cybersecurity program will be tested at some point.
Your incident response should be guided by a plan that outlines the following essential components:
- Event classification – With limited resources, classification allows you to prioritize response to high-level activity involving sensitive financial data access or low-level activity initiated by a user entering the wrong password.
- Roles and responsibilities – Decide who is responsible for detection reporting, notification to executive, containment, recovery, and post-event activity.
- After action review – Here is where you replay the event in reverse to find the root cause of the event. From there, you can adjust the response plan or review policies for amendment.
Incident response is not an area you want to take lightly in financial services.
Implement Financial Cybersecurity Best Practices
Following best practices for financial cybersecurity, financial services organizations can better protect sensitive personal and financial data. The practice of implementing enterprise security is the cornerstone for any fintech. A culture of cybersecurity connects your people with the processes and policies that ensure safe service delivery.
If you’re ready to deploy financial cybersecurity to reduce operational and reputational risk,an expert MSSP will help with all levels of implementation and execution.
Contact RSI Security today to learn more!