For almost any industry, security should be top of mind. This is especially true for those working in banking and financial services. With so much valuable information in their possession, these sectors have been long-standing targets for cyberattacks. These issues have only been heightened over the years as digital transformation continues and digitization increases.
Technology has made managing risk in financial institutions increasingly complex, and while industries focus attention and investment on cybersecurity, they’re also attending to evolving compliance challenges as well.
Threats to Financial Sectors
Due to the sheer amount of data and funds stored by financial institutions, this industry is highly targeted by threat actors. Not only are the financial details and personal information of millions of users threatened, but the consequences of a failure in security are extremely costly. According to a 2019 Accenture presentation, the average cost of cybercrime per company in financial services in 2018 was $18.5 million — significantly higher than any other industry at the time.
While mitigating these risks is assuredly a priority for financial sectors, it’s significant to understand what types of threats are most commonly experienced by these industries. These cyberthreats can range from something as seemingly simple as employee errors and phishing scams, to more complex attacks including credential theft, ransomware and regulatory inaction. The biggest security threats generally consist of malware, social engineering, third-party services, spoofing and unencrypted data — malware being responsible for 75% of data breaches within the banking industry in 2019, per Packetlabs. This malware can be particularly harmful to the financial sector in the form of ransomware, which essentially holds a victim’s computer system and data hostage until a fee is paid. Trend Micro Incorporated found that the banking industry was disproportionately affected by ransomware, experiencing a 1,318% year-on-year increase in attacks in the first half of 2021. This is typically due to the opportunity for a large payout from financial service providers.
As cyberattacks evolve and escalate in frequency and complexity, institutions are intensifying their focus on security. However, along with mitigating these prevailing cyberthreats, banking and financial services are also challenged to maintain compliance with evolving regulations.
Critical Compliance Challenges Cybercriminals Exploit
Compliance within the financial services industry is a necessity to guarantee businesses are following rules to protect clients and their data. This means all federally regulated financial institutions (FRFI) are subject to the framework set forth by the Office of the Superintendent of Financial Institutions (OSFI) while being liable to ensure Service and Organization Control (SOC) 2 compliance for their third-party vendors. The culmination of these standards exists to maintain the integrity and security of consumer data, and without proper compliance, cybercriminals have a heightened opportunity to exploit security weaknesses. If compliance is not properly managed, it can be a detriment to your organization’s reputation, the trust of your customers, the safety of customer and employee data, and your bottom line.
However, despite understanding these expectations, financial institutions can struggle under the volume of security standards and regulatory requirements — both mandatory and optional. This is especially true as digital transformation progresses and regulations continue to expand and evolve. Soon, banking compliance standards will likely involve a host of new focus areas for organizations to keep in mind, as they simultaneously sustain attention on the fundamentals. These contemporary areas of interest include regulation and compliance surrounding cyber and operational resiliency, data infrastructure and technology resilience, third-party and supply chain risk management, digital asset management, and privacy of personal information.
Financial institutions and organizations must balance maintaining compliance with requirements set forth by national bodies with the need to defend against emerging security threats — all while improving the customer experience.
CIC Plus Solutions for Compliance and Security
In the financial services industry, the constant threat of cyberattacks and expanding regulatory standards mean banking, security and compliance must all work in unison. To accomplish this, organizations are increasingly implementing advanced solutions that are capable of supporting these ever-pressing needs.
CIC Plus offers solutions that simplify compliance management and meet your security needs — to provide your business with some much-needed peace of mind. Not only can we help you ensure compliance across the full employee lifecycle, but we also maintain the highest data security practices to protect clients’ information throughout the process. In an industry that’s consistently vulnerable to cyberattacks, this is invaluable.
Our SOC 2 Type 2 audit certification verifies our security practices for risk management, HR practices, change management and systems operations. This audit attests that CIC Plus maintains effective security and confidentiality controls over its handling of clients’ employee data, so you can rest assured that your information is safe. Moreover, our services are hosted in the Microsoft Azure cloud platform and take advantage of multi-layered security controls, such as two-factor authentication, and threat intelligence to help identify and protect against evolving security threats.
In the financial services industry, protecting your data, funds and information is paramount. However, it’s almost impossible to guarantee your data is fully protected without meeting compliance standards. It’s beneficial to employ solutions that offer both durable security measures and simplified compliance management to best protect your business and clients from cyberattacks moving forward.
If you’re interested in learning more about how CIC Plus can streamline your compliance, contact our team today.