Before the global financial crisis in 2008, financial services compliance was there just as a theory, which was not practiced diligently and ended up in the chaos as we experienced. Now, compliance exists for a reason, and banks, financial institutions, and even the general public know the criticality of being compliant with these regulations. In order to put it up simply, financial institutions across the globe are the most targeted entities for fraud and cyberattacks. In this article, we will discuss the need for technical compliance to ensure the protection of financial transactions.
Scott Tominaga on compliance
Scott Tominaga is a leading consultant and financial services advisor offering consulting to many financial institutions and individuals. As a financial advisor in various verticals, including security, Scott describes various aspects of technical compliance for financial institutions in this article. As part of the existing regulations, compliance measures are a minimum requirement for protection, which is referred to as check-mark compliance. Further, we will try to break down these requirements and try to gather some more information that goes farther than the minimum-security requirements.
About Financial Compliance
Financial compliance basically is a ruleset that every financial sector institution must follow to ensure secured and compliant financial transactions. Oftentimes, these rules will be enacted by the regulatory bodies to protect the investors, shareholders, banking customers, and the banks and institutions themselves from any fraudulence.
Fintech institutions and banks are always a target of the threat actors. The financial compliance regulations look at how the data and sensitive financial info are managed to protect it from theft or data breaches. For this, there are many regulations and compliance measures, which we will discuss below.
PCI DSS – Payment Card Industry Data Security Standard
PCI DSS is a set of security guidelines for data protection, which focus more on safeguarding the credit and debit account data. The PCI DSS guidelines protect the involved parties during online payment transactions. It covers the merchant’s POS, service providers, vendors, and intermediaries in payment processing, financial institutions, etc. PCI DSS standards were launched back in the year 2006 and had been continuously improving since then. The major goals of PCI DSS are:
- Forming and regulating a secure financial transaction network.
- Protecting data of credit and debit cardholders.
- Vulnerability management initiatives.
- Ensuring strong access control.
- Monitoring and testing of transactional networks.
- Maintaining an updated policy for information security.
Next, we will explore the fundamental requirements to comply with PCI DSS standards.
- Proper firewall protection.
- Maintaining and upgrading unique system passwords and not using vendor-supplied generic passwords.
- Protecting the cardholder data with encryption.
- Routine scans to ensure data encryption.
- Deployment of anti-virus software and updating it from time to time.
- Deploying foolproof information security system.
- Limiting data access by restricting it to essential users.
- Secured storage of physical data copies and restricting access.
- Tracking and monitoring access logs to ensure compliance.
- Routine testing audits and scans to check for any vulnerabilities.
So, as Scott Tominaga points out, these measures maintain a comprehensive policy to ensure information security across all the organizations, associates, and contractors.
