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BANKS CALL FOR CHANGES TO SEC CYBERSECURITY PROPOSALS

The regulator’s proposals do not take into account other policy goals, according
to a trade body coalition

 * 05/11/2022 - 16:14
 * |
 * Written by  Banking Exchange staff
   
   
   
   
   
   

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A coalition of banking sector trade bodies have written to the SEC calling for
changes to its planned new rulebook on cybersecurity.

The Bank Policy Institute (BPI), the American Bankers Association (ABA), the
Independent Community Bankers of America and the Mid-Sized Bank Coalition of
America, collectively expressed support for the proposals but warned that they
“insufficiently take into account other policy goals”.

According to the letter, targets such as ensuring the cybersecurity of parties,
protecting the soundness of financial institutions, and identifying and
punishing perpetrators of cybercrime, were not met.

The coalition stated that the timing and content requirements for incident
disclosures were made “without sufficient regard” of potential security risks.

The letter stated: “Specifically, the very fact of disclosure that a
cybersecurity incident is ongoing and unremediated may adversely impact a
registrant’s ability to effectively respond to and remediate the incident, and
significantly exacerbate the resulting risks and harms to the registrant and its
shareholders, customers, and others.”

The organizations also stated that periodic disclosures should not be required
to reveal the nature or status of remediation activities, including alterations
to cybersecurity policies. They claimed that publishing such details would
“assist” threat perpetrators who will look for ways to comprise information
systems.

They also took issue with the proposed requirement for banks to disclose details
of their selection and oversight of third-party entities, including contractual
requirements used to tackle security risks.

The letter said banks “should only be required to disclose high-level
information, including confirmation that policies and procedures are
appropriately applied to third-party selection and ongoing oversight”.

The SEC recently doubled its digital finance oversight team, with the addition
of 20 new staff to the newly-rebranded Crypto Assets and Cyber Unit, a part of
its enforcement division.

Tagged under Compliance, Feature3, Feature, Compliance Management,
Compliance/Regulatory, Cyberfraud/ID Theft, Security, Mobile, Online, Tech
Management,

 


 


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