U.S. securities
regulators have unveiled a road map that lays out how they plan to make sure
Wall Street firms are prepared to detect and prevent cyber security attacks.
The nine-page document, posted April 15, contains examples of
the questions Securities and Exchange Commission examiners might ask brokerages
and asset managers during inspections.
The document puts firms on alert to be prepared, for
instance, to provide a comprehensive list of when they detected malware,
suffered a "denial of service" attack or discovered a network breach
since January 2013. The SEC also plans examinations of more than 50 firms that
will focus on cyber security-specific issues.
The document's release comes several months after Jane
Jarcho, an associate director in the SEC's investment adviser examination
program, announced in a speech the agency planned to scrutinize whether firms
have policies to prevent cyber attacks.
The SEC subsequently followed up with a March 26 roundtable
where experts debated how public companies, brokerages, asset managers and
exchanges can protect themselves from cyber threats, and what role the U.S.
government should play to ensure such attacks are adequately disclosed.
The heightened focus on cyber attacks comes at a time when
several major companies, from Target Corp to Neiman Marcus Group, have suffered
major data breaches.
The incidents have sparked a public policy debate about how
customers should be alerted, who should bear the cost of breaches, and how such
information should be disclosed both to government and the public.
John Reed Stark, the SEC's former chief of Internet
enforcement and now a managing director with digital risk management
consultancy Stroz Friedberg, said the SEC's detailed list of questions is both
unusual and "forward-thinking."
"With the public disclosure of this questionnaire, the
SEC is giving up the surprise of one aspect of their exam program and opting to
provide to SEC-registered financial firms a rare chance to prepare," he
said.
In addition to asking questions about past attacks, the SEC
document also indicates that examiners might gather information about how firms
protect private customer information. This includes checking to see how
customers are authenticated to access online accounts and what security
measures are in place to protect PIN numbers.
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