Third-Party Access Management In Financial Organizations

When you think of a bank robbery, you usually picture a thief breaking through the doors of a bank, demanding access to registers and vaults, then getting away with the loot. But criminals have discovered more sophisticated and discrete methods to break into financial institutions, and it’s forcing companies to shift from physical security measures to a digital, cybersecurity strategy.

Over 90% of data breaches are financially motivated, so you’d think cyber criminals would go straight to the source, i.e. a bank. But hackers are taking an alternate route—third-party vendors—to breach financial institutions, and companies in the financial services sector aren’t prepared to face these third-party threats.

According to the 2022 Ponemon Institute report on third-party security, 58% of financial institutions have experienced a data breach caused by a third-party vendor, the highest rate of any industry surveyed. It makes sense—the banks have the money, and hackers want a profit. But instead of going straight through the front doors, criminals are disguising themselves as one of several (or possibly hundreds of) technology vendors that can remotely access a financial institution’s system.

The criminals (whether we’re talking about Danny Ocean or a cyber criminal) both want to compromise and steal something valuable. They breach access by disguising themselves as authorized users who have access to the systems that hold the valuable asset. Once they’re in, they can do their damage. And for financial institutions, there’s a lot of damage that could be done.

In both cases, access points were vulnerable, and in real life, the vulnerability is the remote access connection between a business and a third party. When it comes to cybersecurity, all protective measures begin with securing the external points of access and the vendor identities that are granted privileged access.

Financial Organizations Need Access Control and Monitoring

The Ponemon survey revealed that the access security measures of financial institutions are average at best. Even though concepts like zero trust and least privilege are gaining momentum, the financial sector isn’t controlling or monitoring access enough to prevent bad actors from getting internal access.

Nearly half of all financial organizations surveyed aren’t restricting or segmenting network access, and 52% aren’t able to give just enough access to third parties and nothing more to perform designated responsibilities. Organizations as risky as financial institutions need access controls that can stop a bad actor in their tracks when making their way through systems. If access is uncontrolled, remote access becomes a hallway to several unlocked doors that lead to critical information and assets that could compromise financial systems and client information or lead to theft of money and resources.

Financial institutions also aren’t monitoring access, whether it’s session activity or the access permissions granted to each third-party user. 46% of organizations said they don’t monitor third-party access, and 69% don’t have visibility into the level of access and permissions of both internal and external users.

Third-Party User Identities

User identities with privileged access are just as critical to managing cybersecurity risk as what’s being accessed. Since third-party identities have privileged access, they should be treated differently, especially since 70% of organizations say their data breach was caused by granting too much privileged access to third-party users.

Unfortunately, financial institutions don’t know much about who is accessing their networks, particularly as it relates to which third parties are accessing sensitive financial information. Over half (52%) don’t evaluate the security and privacy practices of third parties before doing business with them, and 46% don’t have a comprehensive inventory of all the third parties with access to private information.

How Financial Organizations Manage Third-Party Access

Less than half of participants in the Ponemon survey don’t rank their third-party management program as highly effective, and 52% say third-party remote access is becoming their business’ weakest attack surface. With the vulnerabilities listed above, it’s no surprise. But the hiring gap is also creating a roadblock to effective cybersecurity.

Financial organizations don’t have enough staff and skilled employees to handle third-party risk management. 57% in the financial sector list “in-house expertise” as an area of improvement within their cybersecurity infrastructure, and 51% said they don’t have anyone assigned to manage third-party risk. Not to mention 66% of IT security teams don’t prioritize third-party access management and 59% feel managing third-party remote access is overwhelming and a drain on internal resources.

It’s difficult to build and maintain a cybersecurity program when you don’t have people, resources, or support, and this is the exact challenge the financial industry is facing. The cycle of mismanagement only continues when there aren’t programs in place to control, govern, and monitor third-party users and access permissions.

Address cybersecurity risks in the finance industry with critical access management

Banks vaults have physical access controls and monitoring procedures to protect the valuable items inside. There isn’t a single person internally or externally that’s capable or trusted enough to walk through the front door of a bank and straight into the vault. Whoever accesses the vault has to be authorized, vetted, and have permission to access the vault. And the protocol doesn’t stop there—that same identity has to be escorted by security, and every action is monitored by security cameras surrounding the vault. Not to mention, the vault door is about a foot thick.

Certain assets need more protection than others. Everything inside a financial institution, from the technology being used to the money itself, is valuable and can be exploited. If financial institutions don’t build their cybersecurity measures like the physical bank vault measures, they’ll find themselves dealing with theft, fraud, and extortion on top of all the other costly implications of a cyberattack.

The most effective method to secure third-party access is by first assessing the access of every user, from the inside out. Inventory your vendor reps, identify each user’s permissions, and restrict them—make sure no third-party user has more access than what’s needed to perform their specific duties. If they only need access to your electronic payment software, don’t give them access to the entire network. Then monitor that access: implement technology that can record and document vendor sessions so all users are held accountable and there’s more visibility.

Then get your identities in line. If you don’t know who is accessing your systems, financial records, or PII of your clients, you won’t be able to tell the difference between a legitimate third-party user and an unauthorized party.