Organizations often confuse the concept of being compliant with being secure. They assume that they must be appropriately protected once they have invested the necessary resources to achieve compliance. Considering that meeting compliance mandates are not cheap, averaging $3.5 million annually. Still, the cost of not meeting compliance mandates is even higher, averaging $9.5 million, according to the Ponemon Institute. In practice, this is not the case.
Compliance is vital as a foundational framework, setting a minimum standard for security controls within organizations and establishing requirements and regulations to ensure a baseline level of security. However, it takes more than compliance alone to provide a comprehensive assessment of the effectiveness of these controls. Mere compliance does not guarantee that an organization’s security measures are fully equipped to combat all potential threats. The dynamic and ever-evolving nature of cybersecurity demands a more proactive and holistic approach beyond mere compliance.
In this blog, we dig into why compliance is insufficient to meet security and how financial organizations can enhance compliance programs to protect their data and assets.
Compliance as a Baseline
Compliance focuses primarily on meeting specific criteria and adhering to established guidelines, often without considering the constantly evolving landscape of cybersecurity threats. Therefore, organizations must go beyond mere compliance and actively assess the efficacy of their security controls to ensure comprehensive protection against emerging risks. This entails conducting thorough risk assessments, implementing advanced security measures, and continually monitoring and adapting security protocols to address the evolving threat landscape.
The effectiveness of security measures lies in first conducting a risk-based assessment that compares the threats faced by an organization with its existing controls. A risk-based approach is crucial in evaluating various threats’ potential impact and likelihood, using a systematic analysis considering both the probability of an incident occurring and the possible consequences if it were to happen.
Using a risk-based assessment, organizations are not just targeting every threat but instead are identifying and prioritizing the most critical risks, allowing them to allocate resources and implement appropriate controls accordingly. This approach enables organizations to focus on mitigating the threats that pose the most significant potential harm and align their security measures with their specific risk profile. It empowers organizations to make informed decisions and allocate resources effectively to ensure that their security controls are targeted, robust, and tailored to address the most significant risks they encounter.
Limitations of Compliance in Addressing Emerging Threats
Compliance requirements play an essential role in setting a baseline for security practices, but they have limitations when addressing emerging threats. For instance, consider the compliance requirement of protection against malware, which most organizations meet by using a traditional antivirus (AV) solution. However, these solutions have inherent limitations in addressing new and unknown threats, relying on previous detections of threats in the wild for identification. Cybercriminals know this and continuously evolve their attacks, making new malware on the order of 450,000 new strains daily, making it virtually impossible for any solution to detect 100% of the existing varieties. The new malware often exploits zero-day attacks, which are vulnerabilities unknown to the software vendor or the security community. As a result, traditional AV solutions that rely on signature-based detection cannot detect and prevent such attacks effectively.
Despite organizations being compliant with an AV solution, there is still a need to supplement the compliance effort using security measures beyond traditional AV. Being secure requires supplementing compliance efforts with a more proactive approach to combat the threat of continuously evolving malware. It necessitates strategies that target emerging threats and may protect without the need for detection.
What Leads to Compliance Failures
Compliance failure can occur in various ways, ranging from intentional non-compliance to incidents that result in non-compliance. Meeting the standards and best practices outlined in compliance mandates is crucial, and failing to implement them on this level is one form of failure. Additionally, compliance mandates often impose limitations on how sensitive data is shared and disseminated. When breaches, security incidents, or malware/ransomware attacks occur, there is a risk of data exfiltration, which ultimately leads to compliance failure.
Direct Cost of Non-Compliance
Non-compliance with legal or regulatory requirements can lead to substantial direct costs affecting an organization’s financial performance. Non-compliance consequences can manifest in the form of penalties and fines imposed for violating specific regulations. To provide insight into the potential financial impact, here are examples of the costs that may arise due to non-compliance:
|GLBA||Up to $100,000 per violation|
|Sarbanes-Oxley Act (SOX) Individuals:||Up to $5 million|
|SOX Companies:||Up to $25 million|
|PCI-DSS||$5,000 to $500,000 (varies based on records)|
|GDPR||Up to €20 million or 4% of revenue|
|CCPA||Up to $7,500 per violation|
Indirect Cost of Non-compliance
Non-compliance with regulations and data protection standards carries consequences beyond financial penalties. The indirect costs of non-compliance can profoundly impact a company’s financial performance. One critical aspect is its effect on customer perception of the organization’s security practices. Failing to meet compliance requirements raises concerns about the company’s ability to protect sensitive information, eroding customer trust and confidence. This can result in losing existing business relationships and reluctance from potential new customers to engage with the company.
Furthermore, companies that experience data breaches or security incidents due to non-compliance often face long-term implications for their profits. Surveys have shown that in the US alone, 83% of consumers say they will stop spending with a business after a security incident. This is evident from research showing that 29% of companies lose revenue after a breach and a 7.5% decrease in stock price.
Identifying the Risks
Financial organizations face diverse threats that pose significant risks to their data. Identifying and understanding these risks is crucial for effectively mitigating them. The risk level associated with each threat is unique to each organization, considering their specific IT infrastructure and the controls in place to mitigate the risks. Failure to address these threats can result in data exposure, compromising sensitive information, and leading to non-compliance with regulatory requirements.
Internal threats pose a significant concern for financial organizations, involving individuals directly accessing sensitive information and systems. These internal actors can range from disgruntled employees who harbor ill feelings towards the company or their job to individuals seeking personal gain by compromising data security. The risk of internal threats is further amplified by external factors, such as organized crime groups, which may exploit vulnerabilities in an organization’s defenses. These external entities can employ tactics like bribery or coercion to persuade employees to participate in more sophisticated attacks. The potential damage caused by internal threats is not limited to data theft but also includes deliberate destruction or manipulation of data.
Direct attackers pose a persistent and ever-present threat to financial organizations. These cybercriminals employ various tactics and techniques to exploit an organization’s infrastructure vulnerabilities and gain unauthorized access to sensitive data. The range of attackers can vary widely, from relatively inexperienced script kiddies to highly sophisticated nation-state actors or organized criminal groups. The size and complexity of the attack surface determine the level of skill and resources the attackers require. Regardless of the attacker’s profile, this threat should never be underestimated or overlooked.
Hidden Threats in Files
Financial organizations know the importance of strong perimeter security measures to protect their valuable data. However, cybercriminals constantly evolve tactics, seeking alternate routes to bypass these defenses. One such method is embedding hidden threats in files, which creates a side-channel attack vector for malicious actors. By hiding threats in seemingly harmless files, cybercriminals can exploit the human factor within organizations. Employees may unknowingly open infected files, disguised as invoices, resumes, or partner materials, which can lead to the deployment of various malicious payloads such as ransomware, rootkits, or backdoors. Instead of relying on complex technical exploits, cybercriminals target humans as the weak link in the security chain.
Additionally, new threats embedded in files can also deceive the security tools and protections in place at an organization.
Phishing attacks have become a prevalent and persistent threat in cybersecurity, particularly because they target the weakest link in the security chain: humans. These attacks aim to deceive employees into divulging sensitive information, granting cybercriminals access to valuable data and enabling them to conduct more extensive and damaging attacks. While login credentials remain a popular target for phishing campaigns, attackers increasingly seek more than basic access. They are after valuable information about internal IT systems, including technical details, vulnerabilities, and configurations.
Additionally, they may be interested in gathering knowledge about internal processes and procedures, allowing them to exploit weaknesses and bypass security measures more effectively. Another concern is gathering information on organizational hierarchy, used for whaling campaigns—highly targeted attacks against key individuals, such as executives or decision-makers.
Stopping the Threats
A multi-faceted approach is required to combat the wide range of threats that financial organizations face. Implementing targeted controls that address specific threats is crucial rather than relying on a single control to eliminate all risks. Each threat requires a tailored response considering the organization’s unique risk profile and security objectives. Factors such as automation and co-integration significantly enhance the efficiency and effectiveness of these controls. Automation streamlines processes and tasks, making them easier to execute and reducing the reliance on extensive staffing. By automating repetitive and time-consuming tasks, organizations can allocate resources more strategically and focus on more critical security activities.
Additionally, co-integration allows different security tools and systems to work together seamlessly. This integration reduces the manual effort required to manage multiple tools and enables the exchange of information and the generation of intelligent, actionable insights. The interoperability of solutions creates a more comprehensive security posture and facilitates quicker and more informed decision-making when responding to threats.
Layers of Control
In building a robust security framework, it is essential to incorporate layers of control that provide overlapping defense mechanisms. This approach recognizes that no single control can guarantee absolute security, as vulnerabilities can exist even in the most robust measures. By implementing multiple layers of defenses, organizations create additional barriers that cybercriminals must overcome, making it significantly more challenging for them to breach the system. Even if one control, such as a firewall, is bypassed, additional layers are in place to impede the progress of attackers.
The goal of security is not to make an organization impervious to breaches but to increase the difficulty level for potential attackers. Overlapping controls enhance the resilience of the IT infrastructure by continually raising the challenge for adversaries and increasing the likelihood of detection and prevention.
Prevention to Meet Compliance
Implementing preventive solutions is crucial for organizations to meet compliance mandates effectively. These solutions fulfill the required controls and demonstrate a proactive approach to security, which is particularly important for regulations such as the Sarbanes-Oxley Act (SOX). By implementing robust preventive measures, organizations can significantly reduce the risk of a security breach and accidental data disclosure, thus ensuring ongoing compliance.
Studies have shown that the cost of implementing comprehensive security measures is often about 10% of the potential financial and reputational damage caused by managing a breach and the accompanying penalties. Taking a preventive stance helps organizations avoid the substantial costs and negative consequences associated with non-compliance and data breaches while fostering a culture of continuous improvement in security practices.
Achieving compliance is merely the initial phase in the fight against cyber attacks. Organizations must go beyond compliance and seek tailored solutions that effectively address their specific risks.
Improving Compliance & Preventing Breaches: Votiro
While Votiro’s products will not solve all of your compliance requirements, the standard of preventing malware is a key use case for using Votiro Cloud.
Votiro stands out as an industry leader in content disarm and reconstruction (CDR), demonstrating its unwavering commitment to delivering top-quality solutions rather than treating it as an ancillary feature within a toolset. Votiro’s mature CDR solution generates high-quality file reconstruction by rebuilding files while preserving their intact and secure functionality. This meticulous approach ensures that no essential context or functionality is lost during reconstruction.
Votiro goes beyond CDR, integrating optional antivirus (AV) capabilities, which generates auditable tracking of the unknown threats eliminated by Votiro as they become discovered. With Votiro’s well-established CDR solution, financial institutions can achieve a proven return on investment, meeting their stringent performance requirements while effectively safeguarding customers against hidden threats.
Votiro is designed for rapid implementation, using an API-centric solution that seamlessly integrates into existing business workflows, enabling immediate protection against cyber threats in the tools and solutions already in use at your organization. Implementation times are impressively short, with SaaS installations taking as little as 10 minutes and on-premises installations taking just 90 minutes.
Contact us today to learn how Votiro sets the bar for addressing hidden threats in files to keep your organization secure while maintaining compliance. You can also skip right to a free 30-day trial of Votiro Cloud!