Cybersecurity Trends for Financial Advisors
Is Your Firm Up to Speed?
Cybersecurity has and will continue to be a primary concern for advisors and advisory firms, especially solo-practitioners. The firms that do not take the appropriate measures risk the potential for a breach, or worse. What we will look to share in this week’s blog is what steps other firms are taking and what those firms who are not equipped to handle it internally can do.
In the world of cybercriminal phishing, advisory firms are viewed as whales. You can well imagine why, given the amount of information and wealth that could be fraudulently obtained should a breach occur.
Imagine the advisory industry as one large parking lot with all advisory firms as vehicles parked in that lot. Now, in every parking lot, there is the danger of your vehicle being broken into or stolen. A cybercriminal is the equivalent of the thief walking through a parking lot full of cars looking for the largest but also the easiest target. Did you leave any valuables in plain view? Or worse, did you leave the doors unlocked entirely? The vehicles that are more difficult to get into (locked, alarm, etc.) are less likely to be victimized because criminals will gravitate to the easier targets.
I think you get the picture. And it is not a pretty one. Craig Morningstar, COO/CISO at Dynamic Advisor Solutions, pointed out that “…many advisory firms can be exposed from a cybersecurity standpoint with the technology they use.” He added that some firms simply do not have the expertise within their staff to address the ever-changing environment.
To get an idea of what trends exist in the industry now, you may want to read an article posted to Investment News earlier this week. You can find the article here.
What do firms do that recognize they do not have the expertise to keep up with the evolving cybersecurity environment? Of course, one way is to outsource to vendors but as Mr. Morningstar clarified, “…’vendors’ does not necessarily equal responsibility.”
“One of the key security measures utilized by Dynamic is to have an integrated system where all of the wealth manager’s services, records, and functions operate within a secure “airtight” environment. Wealth360, the cloud-based platform operated by Dynamic, enables its internet security team to oversee the overall cybersecurity efforts like recurring cyber education and audits to further reduce the possibility of a breach. In this way, Dynamic seeks to be a ‘partner for success’ with the wealth manager or RIA firm in their end-to-end integrated business system rather than just a vendor providing a single, non-comprehensive solution,” says Jim Palumbo, Chief Development Officer.
In the event that a breach did occur, it is vital to have procedures in place to address the breach and minimize exposure.
What we all want to avoid is being in the position of having to notify clients of a breach. There are very few things that could be more damaging to your business.
About Dynamic Wealth Advisors
Dynamic is recognized as a premier provider of essential resources to professional wealth management practices. Its turnkey practice platform includes asset management and enables wealth advisors to save money and focus on clients while positioning themselves for success and growth. With myVirtualPractice, a suite of wealth management practice solutions, Dynamic hands the professional wealth advisor the keys to a comprehensive, custom-built virtual office and practice complete with staff, back/middle office, accounting/billing, compliance and even a Virtual Assistant. The wealth advisor need only add clients and a laptop, and they are up-and-running instantly. For many breakaways and independent wealth advisors, being part of a nationwide community of like-minded professionals is one of the most valuable components of their affiliation with Dynamic.