GUEST ESSAY: Why internal IT teams are ill-equipped to adequately address cyber risks

By Michael Cocanower

Every industry is dealing with a myriad of cyber threats in 2024. It seems every day we hear of another breach, another scam, another attack on anything from a small business to a critical aspect of our nation’s infrastructure.

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Because of this, cybersecurity investments and regulatory oversight are increasing at an astounding rate, especially for those in the financial services industry, bringing an overwhelming feeling to chief compliance officers without dedicated security teams.

And the solution they are turning to is not one that will solve their problems in the long run: handing cybersecurity responsibilities to internal IT teams.

It’s a tale as old as the first computer. When a technical issue arises, hand it over to IT. However, from the sheer amount of regulations coming down the pipeline to the tools necessary to counter threat actors, internal IT is not the right resource for this monumental task.

Regulatory overload

Firms in the financial services industry are staring down the bottom of the regulatory barrel coming into 2024. From identity theft to greater oversight on risk management, internal IT teams will be taking the brunt of these incoming regulations. This comes after the second highest year of enforcement actions from the Securities and Exchanges Commission (SEC).

The SEC’s incoming rules on handling cybersecurity are sweeping to say the least, ranging from 24/7 real-time monitoring to new documentation requirements to new security and vulnerability scanning and remediation requirements. The list goes on. No matter the size of your organization, this influx of regulations is a daunting task to keep up with on top of normal IT personnel responsibilities.

Cocanower

In order to maintain compliance in the coming months, new tools never used by IT workers will need to be implemented to have a secure cybersecurity strategy. To put it plainly, if you hand a tennis novice Serena Williams’ racket, their chances of winning the U.S. Open are slim to none. Experience, on top of the right tools, are necessary to withstand the onslaught of cyber threats currently bombarding the finance sector.

Resources, manpower

Not only are internal IT teams not versed in the necessary tools to counteract threat actors, businesses are not even hiring enough people with the skill sets needed to meet these regulations. Historically, these teams have been structured to focus on day-to-day operational IT tasks, lacking the specialized training and resources required to navigate the intricacies of the latest cybersecurity mandates. And that’s not even to mention the fact that cyberthreats need to be monitored 24/7/365.

Cybersecurity threats don’t stop when you clock out. In fact, that’s most likely when they will happen. For those in IT, schedules and budgets will have to drastically change to accommodate new requirements like real-time monitoring. All factors point to IT teams being in a precarious position, where the demands of complying with new regulations far exceed their available resources and manpower.

This mismatch not only impedes their ability to effectively safeguard against evolving cyber threats but also risks the potential for regulatory non-compliance, leaving financial institutions — and even the IT specialist’s own job security —  vulnerable on multiple fronts.

Assisting your IT team

In order to not overwhelm IT workforces, education and professional development opportunities will be crucial for a secure financial institution. This can also extend to your workforce as a whole.

Regular training sessions for all employees on cybersecurity best practices, potential threats, and the importance of compliance can help ensure that cybersecurity is a shared responsibility, contributing to a more robust defense against cyber threats and regulatory breaches.

Other tactics firms can employ include the adoption of new tools such as security incident and event monitoring (SIEM), real-time vulnerability scanning, endpoint detection and response (EDR) and many others.  Not only will IT teams need to evaluate all of the tools available in the marketplace to find the best  ones for their firm, but they will also need to take time away from their existing responsibilities to garner subject matter expertise around these tools.

The road ahead

Going into 2024, the current resources allocated to internal IT teams underscores a critical need for a strategic overhaul, where financial services firms must either significantly invest in upskilling their internal teams or seek external cybersecurity expertise to ensure alignment with the evolving regulatory landscape.

If companies are willing to provide the necessary support and resources to their internal IT teams to handle these incoming responsibilities and threats, they will be able to weather the regulatory storms ahead.

About the essayist: Michael Cocanower is founder and chief executive officer of AdviserCyber, a Phoenix-based cybersecurity consultancy serving Registered Investment Advisers (RIAs). He has earned certifications as both an Investment Adviser Certified Compliance Professional and as a Certified Ethical Hacker. He also has served on the United States Board of Directors of the International Association of Microsoft Certified Partners and the International Board of the same organization for many years, as well as served on the Microsoft Infrastructure Partner Advisory Council.

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