The risk of a data breach is exceptionally high for financial organizations. Hackers recognize the high value financial data has on the dark web. Other cybercriminals pay significant amounts to get their hands on customers’ personally identifiable information (PII) and commit lucrative cybercrimes, like identity theft and insurance fraud.
One of the most common ways cybercriminals gain access to this data is by exploiting data leaks. Finance companies must recognize the importance of securing data or risk leaking customer data to the public. Data leaks result in harsh fines and legal action when cybercriminals exploit this accidental exposure.
This article explains how data leaks are a high-risk cyber threat and outlines eight ways your organizations can prevent data leaks in the finance industry.
What is a Data Leak?
A data leak is the accidental exposure of sensitive data, either physically or on the Internet. Common causes of leaks include lost or stolen physical devices, software vulnerabilities, operational gaps, process errors, and poor cybersecurity awareness.
Examples of sensitive data which could be exposed in a data leak include:
- Phone numbers
- Social Security Numbers
- Driver’s license details
- Email addresses
- Residential addresses
- Credit card numbers
- Bank account numbers
- Login credentials
The Importance of Data Leak Prevention in the Finance Industry
If an organization doesn’t remediate a data leak fast enough, cybercriminals will inevitably exploit this data as an attack vector in a cyber attack. Simply put, a data leak is a step away from a data breach.
For example, cybercriminals could use leaked passwords to gain unauthorized access to internal systems and carry out a larger cyber attack, such as data exfiltration. If the exposed data includes personally identifiable information (PII), including financial information like credit card numbers, the hacker can compromise personal data immediately.
IBM and Ponemon Institute’s 2022 Cost of a Data Breach report found the financial industry has the second highest data breach costs, closely trailing behind healthcare. This statistic is unsurprising given that financial organizations are subject to strict regulatory requirements, including PCI DSS, SOX, and NIST. Non-compliance is met with significant financial losses, among other damaging consequences, such as legal sanctions and reputational damage. For example, the 2017 Equifax data breach cost the credit reporting agency up to $700 million.
- Learn more about cybersecurity regulations for financial services.
- Learn more about the biggest finance data breaches.
Financial organizations must implement effective cybersecurity practices to enhance data security, or it’s only a matter of time before customer data is leaked and compromised.
How the Financial Industry Can Prevent Data Leaks
Below are eight ways financial institutions can improve their data protection measures to prevent data leaks and avoid costly data breaches.
1. Implement Endpoint Protection
Remote working and bring-your-own-device (BYOD) policies are becoming increasingly common, introducing countless endpoints to an organization’s networks, such as personal phones, laptops, and desktop computers. Endpoint protection, such as firewalls and antivirus software, defends against cyber threats, such as malware and malicious activity on applications. These measures act as a first line of defense against data leaks.
2. Implement a Zero-Trust Architecture (ZTA)
Unauthorized access caused by inadequate user verification can quickly leak data through insider threats. A Zero-Trust Architecture (ZTA) assumes no user outside the network perimeter is safe unless proven otherwise. Financial organizations must implement ZTA, including the use of multi-factor authentication, to ensure that only authorized users have access to sensitive data.
3. Don’t Reuse Passwords
Reusing passwords has a domino effect when a data leak occurs. For example, if an employee’s password is accidentally exposed on the internet and discovered by a cybercriminal, they could attempt to log in to other accounts belonging to that employee.
If the employee uses the same password across multiple accounts, the hacker could quickly gain access to large quantities of sensitive data. Organizations must implement strict password requirements and ensure all passwords are reset following a data leak.
Employees on Apple operating systems can identify any reused passwords from their saved accounts using the Security Recommendations feature.
4. Run Employee Security Awareness Training
Social engineering attacks, such as phishing scams and business email compromise, are among the most common workplace attack vectors. Cybercriminals usually leverage these attacks to carry out larger-scale security breaches, such as ransomware injections. Employees must be educated on common social engineering techniques to avoid being tricked into divulging sensitive information.
They should also be aware of privacy settings and appropriate disclosure on social media sites like LinkedIn. Posting seemingly innocuous information, like birthdays, could be the first port of call for a cybercriminal gathering intel for a phishing attack.
5. Secure the Third-Party Attack Surface
Third-party data leaks could be exposing your organization’s sensitive data. Any company data breached by a service provider remains your responsibility. You must ensure your vendors have effective security measures in place to prevent data leakage. A complete data leak detection solution scans the entire web, including code repositories, to identify third-party data leaks in real time.
6. Create an Incident Response Plan
With the growing use of shadow IT, including personal devices, it’s safe to assume your organization will encounter data leaks. Your organization should have a solid incident response plan covering a variety of cybersecurity incidents, including data leaks. Your plan should include data leak detection and remediation processes to ensure leakage is managed as efficiently as possible. Faster remediation reduces the likelihood of a breach occurring.
7. Identify Vulnerabilities
Unknown vulnerabilities can facilitate data leaks. For example, UpGuard discovered how default permissions on Microsoft Power Apps exposed millions of personal data records. Real-time visibility into your organization’s attack surface allows you to detect and remediate vulnerabilities acting as data leak vectors proactively. A complete attack surface management platform can instantly detect vulnerabilities affecting an organization and its vendors.
8. Detect Data Leaks Immediately
Cybercriminals are most likely to discover and exploit ongoing data leaks. The faster data leaks are found, the faster you can remediate them. Instant data leak discovery should allow organizations to respond as quickly as possible, mitigating the effects of the incident.
Your incident response plan should clearly outline how to prioritize and respond to identified leaks. An effective data leak detection solution instantly discovers and alerts users of data leaks, enabling faster remediation through automated workflows.