NY Dept Financial Services Confirms Our Article

Coming on the heels of Foreclosurepedia's strong, warning five days in advance, to to the Mortgage Field Services Industry to clean up their use of Remote Contractors, Benjamin M. Lawsky, Superintendent of the New York State Department of Financial Services (NYDFS), released a report yesterday confirming our dire warnings. The reality is that Foreclosurepedia knew, well in advance, what was coming down the pike. In fact, we even attempted to privately reach out to certain Clients and speak with them in an attempt to encourage them with respect to developing proper Protocols; in hopes that they would be interested in developing Policies and Procedures. Our response was a deafening silence.

Benjamin M. Lawsky, Superintendent of Financial Services, announced that the New York State Department of Financial Services (NYDFS) released a report today finding significant potential cyber security vulnerabilities with banks' third-party vendors. Banks rely on third-party vendors for a broad-range of services – such as law firms that provide them with legal advice or even companies contracted to run their HVAC systems. Those third-party firms often have access to a financial institution’s information technology systems, providing a potential point of entry for hackers.

“A bank’s cyber security is often only as good as the cyber security of its vendors. Unfortunately, those third-party firms can provide a backdoor entrance to hackers who are seeking to steal sensitive bank customer data,” Lawsky said.

NYDFS conducted a survey of 40 banking organizations – including many of the largest institutions it regulates – about the cyber security standards those firms have in place for their third-party vendors. Key findings outlined in the report NYDFS issued today include:

  • Nearly 1 in 3 (approximately 30 percent) of the banks surveyed do not require their third-party vendors to notify them in the event of an information security breach or other cyber security breach.
  • Fewer than half of the banks surveyed conduct any on-site assessments of their third-party vendors.
  • Approximately 1 in 5 banks surveyed do not require third-party vendors to represent that they have established minimum information security requirements. Additionally, only one-third of the banks require those information security requirements to be extended to subcontractors of the third-party vendors.
  • Nearly half of the banks do not require a warranty of the integrity of the third-party vendor’s data or products (e.g., that the data and products are free of viruses).

As Foreclosurepedia pushes forward with its White Hat assessment of cyber security...

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