The Year Ahead: Privacy and Cybersecurity Issues Facing Financial Institutions in 2021 | Baker Donelson

The Year Ahead: Privacy and Cybersecurity Issues Facing Financial Institutions in 2021 | Baker Donelson

January 12, 2021 0 By administrator

The financial services industry faced unprecedented cybersecurity and privacy challenges in 2020. From learning how to operate with a remote workforce, dealing with a complex and evolving regulatory environment, facing an exponential rise in the number and sophistication of cyberattacks – particularly ransomware attacks and the significant and still unfolding breach of the federal government – and navigating COVID-19 issues, the cyber resilience of financial institutions was tested to its limits.

These challenges continue to exist as we enter the new year, yet 2021 brings a new set of challenges that are likely to substantially impact financial services companies in the year ahead. The incoming Biden administration is expected to place increased focus on data privacy issues, which would represent a stark contrast from the prior administration. Indeed, it’s anticipated that debate around the development of a federal privacy law may intensify. At the state level, many privacy laws that stalled during the pandemic are expected to regain momentum. California continues to lead the pack after passing the California Privacy Rights Act (CPRA), which further expands consumer rights, creates additional compliance hurdles for financial institutions, and establishes the nation’s first privacy enforcement agency. This could also be the year that we finally see changes to the Gramm-Leach-Bliley Act (GLBA) Safeguards Rule and potentially new requirements for financial institution incident reporting, both of which would have a significant impact on information security programs.

Beyond legislation, financial institutions will face a litany of other privacy and cybersecurity issues, including the persistently increasing threat of cyber attacks, the rise in consumer rights and awareness to data privacy at both domestic and international levels, and the need for an increased focus on vendor management. This alert will highlight some of the key privacy and cybersecurity issues that financial institutions are likely to face in 2021 and provide some practical advice on how you can be best prepared to respond.

If you would like additional information concerning any of the issues addressed in this alert, please register for our upcoming webinar on the 2021 Privacy Landscape: An overview of the issues, threats, and regulations financial institutions need to know about this year. This will be the first webinar in our 2021 monthly series examining key cybersecurity and privacy issues facing financial services companies.

New Year New Administration: What Should We Expect?

The incoming Biden administration is fully expected to bring increased attention to data privacy issues. Across the board, changes in federal agency leadership will likely result in increased consumer protections and rights, which would be a significant shift from the Trump administration. Existing federal agencies are also likely to be reorganized and fully staffed, which could lead to…

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