As much as the internet is a boon for most of us, what with its global reach and connectivity, it can also be a curse for financial institutions that rely on major online operations to keep their businesses running. Technology evolves at a brisk pace, and so do the ways in which the internet can be used for exploiting the security of absolutely anything and anyone.
In order to counter this high level of vulnerability, The New York Department of Financial Services sent out a letter to all financial institutions under its supervision as well as other regulators recently to gain feedback and to possibly collaborate on significantly increasing the cyber defenses for the financial sector.
The letter specified among other things that cyber-security is one of the most critical and challenging issues of the financial world, and that the cyber-security space is in need for “robust regulatory action.” Although financial institutions have substantially bolstered their cyber-security efforts in recent years, attackers are finding more clever and sophisticated ways to possibly break into their defenses.
The department aims to effectively work with other federal agencies to develop a security framework that will directly address the most critical issues while also staying flexible to address more common concerns. This proposal would encompass measures in areas ranging from access controls, customer privacy, data governance and disaster recovery planning to data encryption, multifactor identity authentication, audits and loss indemnification for third-party providers in the state of New York. This proposal will finally ensure a tight system to keep those attackers away and the financial institutions safe and working efficiently.