Six Tips for Automating Financial Institution Data Compliance

Data compliance is an ongoing concern for financial institutions, especially in the face of an increasingly onerous regulatory environment and an ever more sophisticated cybersecurity threat landscape.

First, there is the high stakes. Almost every business must now contend with data privacy regulations such as California Consumer Protection Act (CCPA),the General Data Protection Regulation (GDPR) and a host of other data privacy rules either in force now or currently being developed. But financial firms have additional data compliance concerns as part of the tightly regulated financial industry. These include Gramm-Leach-Bliley Act (GLBA), Sarbanes-Oxley (SOX),Payment Card Industry Data Security Standard (PCI-DSS) and others. All of these regulations are strict and with high penalties for non-compliance.

Then there is the increasingly dangerous threat landscape that includes everything from sophisticated AI-driven cybercrime to phishing attacks and human error. Last year, roughly 73 percent of businesses encountered at least one sensitive data leak, according to Microsoft research.In the first half of 2020 alone, more than 36 billion corporate records were exposed by mistake.

This adds up to a problem for compliance and security officers at financial institutions.

The solution for these firms is better and more complete data compliance automation.With robust compliance automation, financial institutions can improve the speed of threat detection, prioritize and respond faster, add greater visibility, and move toward more process standardization that helps cut down on compliance issues.

Businesses of all types are pursuing automation for better data security as a part of their digital transformation strategies, financial institutions among them. There are many solutions that help businesses automate data discovery, classification and ongoing monitoring to this end, including some purpose-built for financial institutions such as Qohash’s cloud-based Qostodian platform.

Not all compliance automation efforts are equally successful, however. So here are six tips for ensuring that your organization’s compliance automation efforts are among those that hit the mark.

Tip #1: Make Infrastructure Automation the Priority

Think big with automation.

While low-level data automation is important, a financial institution will make the biggest impact if it starts with building out infrastructure automation for a more adaptive, responsive IT backend. When infrastructure is automated, businesses lay the foundation for the depth of automation that is part and parcel of digital transformation.

This is more possible, and more necessary, as businesses move toward running largely or wholly on cloud services. Cloud-based services are inherently well-positioned for infrastructure automation.

Tip #2: Lean on Automated Detectors

Compliance and security analysts typically are overloaded with responsibilities. That’s why roughly 44 percent of security alerts go uninvestigated, according to Cisco research.

Shift as much of the work as possible from compliance and security professionals to automated detectors, whether these detectors are rule-based or AI-driven. Offloading workloads to detectors is essential for handling the scale of data that must be identified and addressed for compliance.

Tip #3: Automate Everything

The entire process should be automated and only require oversight.

Don’t settle for partial automation, which is a pre-digital transformation methodology. Everything from alert collection, prioritization, task delegation and processes can and should be automated. Even areas such as compliance checks, vulnerability management and orchestrationshould happen automatically.

Tip #4: Iterate Continuously

Compliance regulations change, business needs evolve, and new security threats emerge. Data compliance automation is not one-and-done.

Automation that stays relevant and meets current needs requires a continuous process of review and adjustment. So financial institutions should build their compliance automation around an agile methodology of constant iteration and adaptation. Include periodic review of the whole automation system as part of the compliance automation project.

Tip #5: Always Stay Involved

While data compliance should be automated end-to-end and require no manual intervention, it still is critically important that compliance and security personnel stay involved through ongoing monitoring of the automated systems.

Automation solutions have come a long way, but they are not yet fully self-correcting and automatically adaptive. With widespread automation, the role of compliance and security personnel shifts to overseeing the processes instead of handling the work directly. Automation still requires human oversight, though.

Tip #6: Tightly Restrict Automated System Access

The power of automation is a double-edged sword. While it reduces workloads and enables much greater levels of data protection, in the wrong hands it also opens the door for catastrophic data leaks and huge process challenges.

Access to a firm’s automated systems should be tightly controlled and limited to the handful of compliance and security professionals who are trained on and responsible for the automated systems. All key stakeholders within an organization should have input into the automation put in place, but access to the actual systems should be far more limited.

Data compliance is more complex and comprehensive than at any other time in history, especially for financial institutions. The good news is that the tools for meeting this challenge also have gotten more robust and comprehensive. Chief among those tools is automation, a cornerstone of data compliance today.

Fully taking advantage of automation for compliance takes thoughtful planning, though. Not all financial institutions will make the jump equally well, but those that follow the six tips above will have a better chance than those that don’t.


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