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Cybersecurity Compliance Explained: Understanding Legal and Regulatory Requirements
The FTC fined Facebook (Meta) a record $5 billion for violating consumer privacy by misusing personal data in 2019. Meanwhile, last year, beauty brand Sephora made headlines for becoming one of the first companies to face action under California's CCPA.
Sephora was fined $1.2 million by the California Attorney General for failing to disclose to consumers that it was selling their personal information and for not honoring consumer opt-out requests.
Back in 2018, Anthem Inc. was fined $16 million by the U.S. Department of Health and Human Services (HHS) for a massive data breach that exposed the personal information of nearly 79 million people. This was the largest HIPAA fine at the time.
Massive non-compliance fines in the past years have made compliance a crucial element for cybersecurity teams across all sectors. That said, this adherence to cybersecurity laws and regulations is not just about avoiding fines; it's about protecting sensitive data, maintaining customer trust, maintaining smooth operations, and securing your organization’s information assets.
For the most part, security teams are keen to meet compliance requirements—-this means understanding compliance requirements SOC2, CCPA, HIPAA GDPR and PCI DSS and the differences and overlaps between programs mandated at your organization, which many be these or any other compliance frameworks. Next, security teams need to meet compliance requirements as part of daily cybersecurity KPIs.
This may get more complicated as security teams look to identify overlaps (around data protection) and distinctions between various requirements to avoid duplication of controls.
For example, penetration testing by a third party may be required for both PCI DSS certification as well as SOC2 certification. If you have conducted pentesting for one, the same reports can be utilized as evidence for the other.
In this blog, we discuss the significance of compliance and the baseline actions you need to account for when launching a cybersecurity compliance program at your organization.
Who Needs to Care About Compliance?
The short answer: everyone. If your organization works with data, which most do, or is exposed to the internet, which is pretty much all companies, cybersecurity compliance should be a top priority. Data breaches are becoming more frequent and increasingly sophisticated—-no organization is completely immune from potential cyberattacks (not even the world’s biggest tech names, as the Microsoft DDoS attack in July this year would indicate).
That said, while larger companies might represent a bigger achievement for cybercriminals, small to medium-sized businesses (SMBs) are often targeted more frequently because they are perceived as easy prey. SMBs get attacked every day—-you don’t hear about it, because, unlike Microsoft, these stories do not typically become global headlines.
So why should you care about compliance?
Customer trust
As we discussed in the introduction, aside from abiding by the law, displaying compliance is crucial to building and maintaining customer trust. Adhering to CCPA, SOC2 HIPAA and GDPR compliance requirements, for example, demonstrates to your customers and partners that your organization takes data security seriously. In some cases, compliance might even be part of a client mandate.
Security posture
Moreover, achieving compliance can significantly improve your organization’s overall security posture. By aligning with SOC 2 compliance requirements, NIST compliance requirements, or ISO 27001 compliance requirements, for instance, you’re also implementing best practices that strengthen your security defenses. Regular assessments and testing of security controls under CMMC compliance requirements—also listed as SOX compliance best practices— further enhance your organization’s resilience against cyber threats.
Insurance requirements
Finally, many organizations obtain cyber insurance to mitigate the financial risks of a cyberattack. However, this insurance often comes with conditions and requirements tied to cybersecurity compliance. Non-compliance could lead to denied claims, leaving your organization vulnerable to the full financial impact of a cyber incident. This could well bankrupt an SMB, or at least seriously dent your bottom line.
What Does an Organization Have to Do to Ensure Compliance?
To ensure cybersecurity compliance, you need to establish risk-based controls that protect the confidentiality, integrity, and availability of information. Whenever data is stored, processed, integrated, or even transferred (or all of the above), it must be safeguarded according to your industry's specific cybersecurity laws and regulations.
Meta i.e. Facebook, for instance, was fined €1.2 billion in May 2023, for transferring the personal data of European users to the US in the absence of mandated data protection protocols.
This means that your organization must, at the very least:
- Implement technical controls to secure data and prevent unauthorized access.
- Conduct regular risk assessments to identify and mitigate potential threats.
- Ensure ongoing monitoring and auditing of security practices.
- Train employees on cybersecurity compliance requirements to ensure they understand the importance of protecting sensitive information.
Note that this is just the baseline for cybersecurity compliance. Depending on which framework you’re looking to attain compliance with, there may be distinct, incremental measures mandated. Most importantly, you cannot view compliance as a one-time activity. Achieving and maintaining compliance is an ongoing process.
What Data Do You Need to Protect?
Most cybersecurity laws and regulations revolve around the protection of sensitive data, which can be categorized into three main types: Personally Identifiable Information (PII), financial information, and Protected Health Information (PHI).
- Personally Identifiable Information (PII): This includes data such as your customers’ full names, addresses, social security numbers, and dates of birth. GDPR, CCPA, and HIPAA compliance certification are particularly focused on protecting this type of information.
- Financial Information: This covers credit card numbers, bank account information, and other financial details. PCI DSS compliance requirements are specifically designed to safeguard this data.
- Protected Health Information (PHI): This includes medical histories, insurance records, and other health-related data. HIPAA compliance requirements are crucial for organizations that handle this sensitive information.
Ptaas Can Help You Get Compliant Easily, Effectively, Reliably, And Affordably
Achieving all the points outlined in this article is essential for maintaining a robust security posture, but it’s not without its challenges. Security frameworks often mandate regular penetration testing, and this is critical. However, the reality for many businesses—especially SMBs—is that conducting these tests regularly and remediating issues within strict SLAs can be overwhelming. This is where pentesting service platforms like Siemba offer a practical solution. Siemba’s Penetration Testing as a Service (PtaaS) provides you with the expertise and resources needed to stay compliant without overburdening your internal team. Contact Siemba, to ease and improve compliance workflows today.
FAQs
1. What are the key components of a cybersecurity compliance program?
The key components of a cybersecurity compliance program would broadly include:
- A system for identifying sources of risks
- The right mix of controls i.e. policy and procedures, and a team focussed on compliance, to mitigate risks identified
- Regular risk/vulnerability assessments
- Ongoing monitoring and auditing of risks and controls
- Training the larger team on compliance requirements
2. How do you achieve PCI compliance?
Achieving PCI compliance involves meeting the Payment Card Industry Data Security Standard (PCI DSS) requirements. This includes securing cardholder data, implementing strong access control measures, regularly monitoring networks, and maintaining a robust information security policy.
3. What are the legal risks of handling customer data without being compliant?
Failing to comply with cybersecurity regulations when handling customer data can result in significant legal risks, including hefty fines, lawsuits, and damage to your company's reputation. Non-compliance may also lead to penalties under laws like GDPR or CCPA, restricting your ability to operate in certain markets.
Beyond legal risks, lost opportunities are another risk for a company that isn’t actively investing in compliance. Potential clients that value compliance, will typically also only select compliance-focused parties in their vendor selection process.
A third risk relates to insurance: Your cyber insurance policy will typically demand specific compliance framework certifications for your company to be eligible for cover.
Sandhya Prashant
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The Importance of Cloud Security Assessment: Safeguarding Your Digital Assets
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