If there's one lesson to be learned from the cyberattacks that plagued JPMorgan Chase in 2014 and Equifax in 2017, it's that data security breaches are costly. They not only result in downtime, but they also lead to technical investigations, data recovery, legal fees, and settlement payments.
JPMorgan Chase didn't disclose the total cost of their breach, but they said they would be spending $250 million annually to improve security. Equifax lost more than $242 million, prompting them to promise to spend more on their IT needs. Aside from monetary loss, the breaches also incurred reputation damage, so both companies also had to rebuild their clients' broken trust.
If there's a second lesson to be learned, it's that when a multinational investment bank and a top credit agency become victims of cybercrimes, everyone should take security seriously. Data security breaches are a major problem in any industry, but even more so in financial services. When other people's money is involved, it's crucial to take any and every step to ensure their investments are always protected and safe.
However, financial institutions aren't necessarily experts in cybersecurity, so it's best to align themselves with an experienced and reputable managed services provider (MSP) to handle their IT needs; specifically, one that specializes in processing and storing data to minimize risks. There are many benefits to working with an MSP, the biggest of which are:
Physical Data Center Security
MSPs often partner with cloud computing platforms such as Amazon Web Services (AWS), Microsoft Azure, and Google Cloud to deliver the services they offer. These platforms provide hosting services, so they're in charge of their data centers' infrastructure and security. This means financial institutions don't need to invest in their own infrastructure; they simply need to subscribe to an MSP's services to utilize state-of-the-art, secure facilities for sensitive data.
Cloud Services Security
MSPs provide security for data stored in the cloud. Each client's cloud environment is logically separated into a container which is accessible only with the right login credentials. The result is a single-tenanted environment that doesn't intersect with other environments.
Most MSPs use 24/7 intrusion detection systems to track attack patterns and inform the system team if one is detected. The approach is more proactive than reactive, ensuring threats are nipped in the bud before they can even do harm. This will save financial institutions from spending on damage control. But in the event a malicious attempt does become successful, MSPs can mitigate the effects.
Financial institutions are subject to a lot of regulations for which compliance is a must. MSPs can help in this aspect because they monitor, track, and record everything. If there's an attempted system attack or unauthorized login, MSPs can catch those. If a client wants to have an audit trail log of every user who uploaded and revised a file, MSPs can provide that too. Having records of these activities can help financial institutions pass regular internal and external auditing because of the increase in transparency and accountability.
A part of the IT services offered by MSPs is consulting. They have teams of experts, so clients can tap into that knowledge to get guidance on training staff on data security, investing in new technology, designing a strategic IT roadmap, and transitioning away from legacy systems. Since financial institutions aren't necessarily experienced in technology given that their core business is in a different field, MSPs can play the crucial role of tech adviser.