The Cybersecurity Law Report

Incisive intelligence on cybersecurity law and regulation

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By Topic: SEC Guidance

  • From Vol. 2 No.10 (May 11, 2016)

    SEC Teaches Broker-Dealer a Lesson About Keeping Business Emails Secure

    In its continued enforcement of appropriate cybersecurity controls, the SEC initiated administrative proceedings against Craig Scott Capital, LLC (CSC), a broker-dealer based in Uniondale, New York, and its two principals for failing to protect confidential consumer information by using personal email addresses for business matters. “The enforcement action, including the fines imposed, reflects how seriously SEC takes the adoption of and compliance with proper policies and procedures,” Anastasia Rockas, a partner at Skadden, told The Cybersecurity Law Report. The SEC, alleging no harm to consumers, fined CSC $100,000 and its two principals $25,000 each. See also “Investment Adviser Penalized for Weak Cyber Polices; OCIE Issues Investor Alert” (Sep. 30, 2015).

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  • From Vol. 2 No.1 (Jan. 6, 2016)

    Cybersecurity and Whistleblowing Converge in a New Wave of SEC Activity

    The SEC has long-prioritized incentivizing corporate whistleblowers to report violations of the securities laws, and protecting them when they do.  Increasingly, the federal agency also has vigorously enforced certain key aspects of cybersecurity, as its importance has permeated every facet of the way registered entities operate.  In a recent webinar, Orrick attorneys Mark Mermelstein, Jill Rosenberg and Renee Phillips examined how these two formerly disassociated areas of regulatory enforcement are converging in a new wave of SEC guidance and enforcement.  This article discusses the practitioners’ insights on the SEC’s recent initiatives and enforcement actions both in cybersecurity and whistleblowing contexts; the applicable regulations; and how companies can address and mitigate the risks of cybersecurity whistleblower actions.  See also “The SEC’s Updated Cybersecurity Guidance Urges Program Assessments” (May 6, 2015).

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  • From Vol. 1 No.13 (Sep. 30, 2015)

    What the OCIE Cybersecurity Risk Alert Means for Investment Advisers and Broker-Dealers

    Continuing its emphasis on the cyber-preparedness of broker dealers, the SEC Office of Compliance Inspections and Examinations (OCIE) announced a second round of examinations “to assess implementation of firm procedures and controls.”  On September 15, 2015, OCIE issued a Risk Alert detailing its concerns, as well as sample requests for information in six focus areas: governance and risk assessments, access controls, data security, vendor management, training and incident response.  We analyze the alert and explore the cybersecurity implications for investment advisers and broker-dealers.  See also “Meeting Expectations for SEC Disclosures of Cybersecurity Risks and Incidents (Part One of Two),” The Cybersecurity Law Report, Vol. 1, No. 10 (Aug. 12, 2015); Part Two, Vol. 1, No. 11 (Aug. 26, 2015).

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  • From Vol. 1 No.7 (Jul. 1, 2015)

    SEC Commissioner Says Public-Private Partnership Is Key to Effective Cybersecurity

    In a speech at this year’s SINET Innovation Summit, SEC Commissioner Luis Aguilar emphasized the “scope and urgency” of cybersecurity threats and the ineffectiveness of many network security programs, citing a multitude of studies.  He also called for more formalized information-sharing between private sector companies and the government.  See also “In a Candid Conversation, FBI Director James Comey Talks About the ‘Evil Layer Cake’ of Cybersecurity Threats,” The Cybersecurity Law Report, Vol. 1, No. 5 (Jun. 3, 2015).

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  • From Vol. 1 No.3 (May 6, 2015)

    The SEC’s Updated Cybersecurity Guidance Urges Program Assessments 

    With its new Investment Management Guidance Update on cybersecurity, the SEC is “now looking at more comprehensive assessment of controls and threats, not just from external sources but also internal sources,” Marc Lotti, a partner at ACA Aponix, told The Cybersecurity Law Report.  “Right now, investors and SEC don’t see [disregarding technology risk] as ignorant, they see it as negligent.”  The Guidance discusses actions that investment advisers and companies should consider to mitigate those risks and enhance their cybersecurity programs.

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