Financial services companies face increasing pressure to stay compliant with cybersecurity regulations. Whether you're a credit union, investment firm, or accounting practice, protecting sensitive financial data is no longer optional. It's required by law.

We break down the 5 essential cybersecurity requirements for financial services companies and how to stay compliant with evolving standards like 23 NYCRR 500 and other financial cybersecurity regulations.

Cybersecurity Regulations for Finance

Cybersecurity regulations for financial institutions are growing stricter. Agencies like the New York Department of Financial Services (NYDFS) and federal regulators require strict controls to protect consumer data.

Top compliance regulations include:

• 23 NYCRR Part 500 (NY Cyber Regulation)
• GLBA (Gramm-Leach-Bliley Act)
• SOX (Sarbanes-Oxley Act)
• FFIEC Guidelines
• PCI-DSS (if processing payments)

Failing to meet these standards can result in fines, lawsuits, or worse...a breach of client trust.

Why Compliance Matters More Than Ever

➡ 60% of financial services firms report daily cyberattacks
➡ The average breach costs $5.97 million in finance, higher than almost any other industry
➡ Regulations like 23 NYCRR 500 are now actively enforced in audits

You’re not just protecting data. You’re protecting your reputation, operations, and bottom line.

1. Comprehensive Risk Assessment

Before implementing any controls, financial institutions must conduct a risk assessment to:

• Identify system vulnerabilities
• Understand where sensitive data lives
• Prioritize the biggest risks to the business

Why it matters: Regulators want proof that you understand your risks and have a plan. Without this, your compliance program won’t hold up.

What to do: Have a third-party like Equinox perform a network assessment (like our NetDetect) to uncover hidden risks.

2. Strong Access Controls

Not everyone on your team needs access to everything. The best access control strategies include:

• Multi-Factor Authentication (MFA)
• Role-based access permissions
• Least privilege principles

Example: A financial advisor should not have admin-level access to your entire server infrastructure. And every login should require more than a password.

✅ Bonus Tip: Use identity and access management (IAM) software that tracks all changes and logins.

3. Regular Monitoring & Incident Response Planning

Cybersecurity regulations for financial institutions require that you not only defend, but you must also detect and respond.

What regulators expect:

• 24/7 threat monitoring
• An incident response plan (IRP) that is tested and documented
• Logging of all access and security events

Why it matters: The average time to detect a breach is 207 days. Without monitoring and a solid IRP, you won’t meet compliance or respond fast enough.

What to do: Work with an MSP that provides Security Operations Center (SOC) services, like Equinox.

4. Data Encryption Standards

Encryption is one of the most basic (yet most overlooked) banking cybersecurity regulations.

✔ At rest: All financial data should be encrypted on servers and hard drives
✔ In transit: Use TLS/SSL for email, websites, and any file sharing
✔ For backups: Ensure backup data is encrypted and stored securely (bonus points for offsite)

Failing to encrypt customer data can be a direct violation of 23 NYCRR 500 and other financial data security regulations.

5. Compliance with 23 NYCRR Part 500

The 23 NYCRR 500 regulation, set by the NY Department of Financial Services, is a leading cybersecurity framework that many other states are now adopting.

Key Requirements:

• Designate a Chief Information Security Officer (CISO)
• Conduct annual risk assessments
• Maintain a written cybersecurity policy
• Perform penetration testing & vulnerability scans
• Implement MFA and encryption

Many states and regulatory bodies now use 23 NYCRR Part 500 as a standard to benchmark against.

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​​​​​​​Your Next Step Toward Compliance

Most financial services companies think they’re secure until they’re audited or breached. To protect your firm and stay compliant with financial cybersecurity regulations, you need ongoing risk assessments, modern access and monitoring controls, and compliance with 23 NYCRR 500 and other standards.

Is Your Firm Ready for a Cybersecurity Audit?

Equinox offers a limited-time FREE network assessment (NetDetect) to help finance leaders uncover gaps, score compliance risk, and get a custom compliance roadmap.

Includes:

• Cybersecurity compliance check
• Vulnerability scan and firewall review
• Risk scoring and executive summary

Book Your Network Assessment Today