Cyber Security

NYS DFS September 4, 2018 Cybersecurity Compliance Deadline

Tuesday, September 4, 2018 marked the New York State Department for Financial Service’s deadline for compliance with several sections of cybersecurity regulation 23 NYCRR 500 (the “Regulation”).  The Regulation covers any organization that operates (or is required to operate) under a license, registration, charter, certificate, permit, accreditation, or similar authorization under the Banking Law (Title 3 of the NYCRR), the Insurance Law (Title 11 of the NYCRR), or the Financial Services Law (Title 23 or the NYCRR) (a “Covered Entity”).  This is the third compliance deadline in a series of milestones under the Regulation and requires that five new requirements must be in place.  The September 4 compliance requirements include:

  • Audit Trail (Section 500.06): Maintain systems that (1) are designed to rebuild material financial transactions to allow the Covered Entity to conduct normal operations and meet their obligations and (2) include audit trails that can detect and respond to cybersecurity attacks.  Records supporting (1) and (2) must be preserved for five years and three years, respectively.
  • Application Security (Section 500.08): Have a cybersecurity program with written procedures and standards covering the in-house development of applications used by the Covered Entity, as well as procedures for evaluating the security of externally developed applications.
  • Limitations on Data Retention (Section 500.13): Include in the cybersecurity program policies and procedures for the secure disposal of certain non-public information on a periodic basis after it is no longer necessary for business operations or other legitimate business purposes. 
  • Activity Monitoring (Section 500.14(a)): Maintain policies and procedures designed to monitor the activity of employees and agents authorized to access a Covered Entities information systems and data and detect unauthorized access or use of certain non-public information.
  • Encryption of Nonpublic Information (Section 500.15): Have in its cybersecurity program controls—including encryption—that protect non-public information held or transmitted by the Covered Entity.  If encryption is not feasible, the Covered Entity must use alternative compensating methods to secure the data.  To the extent that a Covered Entity uses alternatives methods to encryption, the feasibility of encryption must be reviewed annually.

By February 15, 2019, each Covered Entity must submit to the NYS DFS a certification of compliance with the above requirements.  The last compliance deadline is March 1, 2019, when a Covered Entity must implement policies and procedures to ensure the security if information systems and non-public information accessible by third-party vendors.  The third-party requirements are expected to be the most difficult to implement, as larger institutions may need to review and revise policies with hundreds and thousands of third-party vendors that manage critical aspects of business operations.

Discussion

No comments yet.

Leave a comment

Your email address will not be published. Required fields are marked *

Welcome to Data Points!

The technology and regulatory landscape is rapidly changing, thus impacting the manner in which companies across all industries operate, specifically in the ways they collect, use and secure confidential data. Moore & Van Allen’s Privacy & Data Security Group recognizes the challenges clients face in the effort to stay abreast of such volatility. “Data Points” seeks to educate by providing transparent and cutting-edge insight on the most critical issues and dynamics. Our goal is to inform business decision-makers who are navigating these waters about the information they must protect, and what to do if/when security is breached.

Connect To Recent Authors

  • Karin McGinnis:  View Karin McGinnis' Bio View Karin McGinnis' LinkedIn profile
  • Todd Taylor:  View Todd Taylor's Bio View Todd Taylor's LinkedIn profile
  • Brandon Gaskins:  View Brandon Gaskins' Bio View Brandon Gaskins’ LinkedIn profile
  • Robert Sumner:  View Robert Sumner’s Bio
  • Carol Bowen:  View Carol Bowen's Bio View Carol Bowen’s LinkedIn profile

  • Subscribe to Blog via Email

    Follow MVA

    Facebooktwitterlinkedinrss

    Blog Topics

    Archives

    Interested In Other Topics?

    Tell us what else you are interested in here.

    Our Privacy & Data Security Practice

    Moore & Van Allen has a Privacy & Data Security practice with the depth and breadth to advise the multitude of business industries and practices impacted, including sales, human resources, data maintenance and storage, IT, legal and compliance, labor and employment, health care, finance, cross-border transactions, energy and litigation. All require careful attention to protecting the privacy of personal information as well as preserving the integrity of company, customer or third party data. To help our clients successfully navigate their data security challenges and manage their risk in these areas, our multi-disciplinary team draws on their deep experience in addressing data privacy and information security obligations and disputes. Read More About Our Practice and Meet the MVA Privacy & Data Security Team.

    Disclaimer

    No Attorney-Client Relationship Created by Use of this Website: Neither your receipt of information from this website, nor your use of this website to contact Moore & Van Allen or one of its attorneys creates an attorney-client relationship between you and Moore & Van Allen. As a matter of policy, Moore & Van Allen does not accept a new client without first investigating for possible conflicts of interests and obtaining a signed engagement letter. (Moore & Van Allen may, for example, already represent another party involved in your matter.) Accordingly, you should not use this website to provide confidential information about a legal matter of yours to Moore & Van Allen.


    No Legal Advice Intended: This website includes information about legal issues and legal developments. Such materials are for informational purposes only and may not reflect the most current legal developments. These informational materials are not intended, and should not be taken, as legal advice on any particular set of facts or circumstances. You should contact an attorney for advice on specific legal problems. (Read All)