The Securities and Exchange Commission issued an investigative report last week cautioning public companies to consider cyber incidents and threats when implementing internal accounting controls. The report details the SEC Enforcement Division’s investigations of nine public companies that were victims of cyber-related fraud schemes to determine whether the companies may have violated the federal securities laws by failing to maintain a sufficient system of internal accounting controls. Based on the investigations, the report concludes that public companies’ internal accounting controls […] Read more
“To Harmonize or Not To Harmonize: That Is the Question.” With the the GDPR fast approaching on May 25, 2018, European Member States are getting ready with the implementation of national legislation. Although the GDPR is a regulation, and directly applicable in all Member States, it has left room for country-specific legislation in several different regards (such as the processing of employee data or individual rights restrictions). Most Member States still only have draft legislation at this point, but the expectation (or at least intention) is that each country will have adopted legislation [...] Read more
On December 5, 2017, the National Institute of Standards and Technology (NIST) released a revised draft of its proposed updates to its Framework for Improving Critical Infrastructure Cybersecurity. The revised draft includes a new section on communicating with stakeholders about cybersescurity requirements, addresses stakeholder concerns regarding cybersecurity supply chain risk management and measuring cybersecurity risks and benefits, and addresses six new topics, including the Cyber-Attack Lifecycle. NIST has updated both the Framework and its accompanying Roadmap.
The revised Framework includes [...] Read more
In June, the Federal Trade Commission released a new guide for businesses on implementing sound data security protections and procedures. In “Protecting Personal Information: A Guide For Business,” the FTC offers “10 practical lessons” based on the numerous enforcement actions brought by the FTC. The guide offers insight into the thinking of this key federal regulator.
Key points from the guide:
“Start with Security.” Build information security considerations into business processes so that they are part of “the decisionmaking in every department of your business.” The FTC [...] Read more
On May 11, 2017, President Trump signed a long-awaited executive order on cybersecurity (the “Order”). The Order directs executive agencies to complete a risk management report based on the NIST Cybersecurity Framework (the “Framework”) and also requires the Department of Homeland Security (DHS) and other agencies to undertake activities in support of effective cybersecurity risk management for operators of critical infrastructure. More generally, the Order directs several agencies to submit reports to the President on a varied set of cybersecurity-related topics. These measures demonstrate [...] Read more
Europe is facing two important reforms addressing cybersecurity, which will apply in 2018. Jan Dhont and Delphine Charlot outlined the details of these regimes in an article for the Society of Corporate Compliance and Ethics, which you can read here.
More regulators (apart from the FTC) are now taking note of cybersecurity issues in the financial services industry and are taking steps to protect the industry and its consumers.
Earlier this year, the Consumer Financial Protection Bureau (“CFPB”) issued its first enforcement action on data security against an online payment system. In June, the Federal Financial Institutions Examination Council (“FFIEC”), an interagency body, issued a press release advising financial institutions to review their risk-management practices. Last month, the New York State Department of Financial [...] Read more
On September 13, 2016, Governor Andrew Cuomo announced the issuance of proposed “first-in-the-nation” cybersecurity regulations for entities regulated by the New York Department of Financial Services (DFS), including jurisdictional banks, insurance companies, and other financial institutions. The proposed regulation will be subject to a 45-day comment period prior to being issued as a final rule. Once finalized, the regulation would become effective on January 1, 2017, at which point a 180 day "transitional period" would go into effect, during which entities would need to come into compliance [...] Read more
The Centers for Medicare and Medicaid Services (“CMS”) issued a final rule on September 8th, 2016 establishing national emergency preparedness requirements for providers and suppliers participating in Medicare and Medicaid in response to “inconsistency in the level of emergency preparedness amongst healthcare providers.” The rule will be officially published in the Federal Register on September 16th, 2016, and providers and suppliers subject to the rule must comply by November 15th, 2017. Notably, CMS describes cyber-attacks as a potential risk to assess when implementing the emergency [...] Read more
The Multi-State Information Sharing and Analysis Center (MS-ISAC) published its 2016 mid-year review on August 22, 2016, highlighting large incidents of malware infections, with particular emphasis on ransomware and click fraud malware. In contrast to the MS-ISAC report, however, an August 2016 report suggests most organizations would benefit from addressing issues of credential management and network segmentation. The report is based on data collected over the course of 100 internal penetration tests (i.e., tests assuming one user on the network has already had their account compromised) on [...] Read more
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