May 08, 2014

N.Y. to test cyber readiness of CUs, banks

May 9, 2014 – New York Gov. Andrew Cuomo has instructed the Department of Financial Services to assess the cybersecurity preparedness of credit unions and banks chartered in that state.

The examinations will apply to all state-chartered banks and credit unions as well as foreign banks with headquarters based in New York. According to American Banker, the department had found in a year-long study of state banks that their biggest security problem was facing "increasingly sophisticated threats" and cyberattacks.

"While the new cybersecurity scrutiny will force many to make investments they might have otherwise put off, in an environment of overall skyrocketing regulatory costs, many see it as reasonable and inevitable," the article says. The article says 77 percent of New York financial institutions surveyed by DFS said they raised their information security budgets over the past three years; 79 percent said they had plans to make such increases in the coming three years.

The Federal Financial Institutions Examination Council said Wednesday that member agencies will conduct cyber security-related vulnerability and risk-mitigation assessments of regulated institutions later this year.

As federal agencies look to regulate financial institution, NAFCU continues to call for national data security standards for retailers in the wake of the massive Target corporation breach. Credit unions and banks are already subject to such standards under the Gramm-Leach-Bliley Act.