Cybersecurity is rapidly becoming the most integral part of any business in the world. With cyberattacks against banks happening more often and more aggressively, many people are looking to only do business with those who put data hygiene and security as their priority.
To illustrate this push for compliance and transparency, New York financial companies may be on the hook to face fines under state cybersecurity rules following an April 15 compliance deadline.
Companies such as Equifax Inc., Bank of New York Mellon Corp., and American Express Banking are legally bound to show that they have certain cybersecurity protections in place by the deadline as well as prove that consumer data is safe from hackers. What’s more, these institutions and others like them have to also show that they routinely check their systems for weaknesses that can lead to major breaches.
The New York State Department of Financial Services’ April 15 deadline, which aligns with the tax deadline, was imposed to let financial firms know that they have the next couple of months to get their networks and security systems in the right place before they take on fines. After the deadline, it’s expected that enforcement of these rules will increase, leading to even more fines but also hopefully more awareness around this growing concern.
NY Banks Under Pressure
Banks have increasingly been targeted by hackers for customer information, including assets, social security numbers, and account information. In the first half of last year alone nearly 4,000 cyberattacks of different sizes and effects hit financial institutions. This alarming statistic has put a new emphasis on banks to tighten their security and protect their assets and operations with cyber liability coverage, for example.
Banks who find themselves on the other side of the deadline not in compliance are likely to be slapped with fines, license suspensions, or orders to stop any unsafe practices. And since New York City is arguably the financial capital of the world, something like this sets a standard for firms around the globe.
Equifax Data Breach
What prompted this stricter push for regulation can be connected back to the massive 2017 Equifax data breach, which exposed the data of more than 143 million Americans. After March of that year, the state financial services agency began issuing cybersecurity rules. Now, nearly three years later, the agency is finally drawing a line in the sand and is set to issue fines.
Companies should be sure to reassess their cybersecurity protections and see how they can update their compliance with the rules being placed. By keeping a high level of awareness of what risks and threats are out there, and looking into protection with cyber liability insurance, financial firms can avoid major fines and keep their customers’ information safe.