money blowing awayI’m here at RabbitHole, Inc., talking with the company’s Manager of Money in his office, which is buried in the Facilities Department, down in the building’s basement. I’m interviewing him to get a better sense of how RabbitHole manages money as a corporate asset.

Pardon my asking, but how much money does RabbitHole have?

“Frankly, no one knows – we don’t really keep track of that. We have boxes of paper currency stored off-site, but as for ‘active’ money, our employees keep that pretty much wherever they choose – in the network money systems, in their individual offices, in mobile wallets, and probably some stashed at home.”

But isn’t that your job? I mean, you’re the “Manager of Money,” right? 

“Nope – that’s indeed my title, but I don’t have the authority to manage all of RabbitHole’s money. My focus is just on the paper money, not electronic accounts and transfers. And I only keep track of the paper currency that is boxed up and kept off-site – what employees do with money day-to-day is up to them, their business units, and the company’s Money Policy.”

What does the Money Policy say?
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Our firm’s elephant icon is a nod to The Blind Men and the Elephant, the familiar, age-old parable for how we often do not see the big picture, but instead only the parts we directly encounter. And so it goes for organizations’ data. Individual company functions and departments often have their own, limited perspectives on information, seeing only the risks and opportunities with which they are directly familiar. Limited perspective yields limited perception – not a good thing for identifying, understanding, and controlling organizational risk.

I actually prefer a slightly different version, The Blind Elephants and the Man:

One day, six blind elephants were in a heated argument about what Man was like. To resolve their dispute, they sought out and found a man. The first elephant “felt” the man and then proclaimed “Man is flat.” Each of the other elephants, in turn, felt the man, and they all agreed.

The moral? Limited perspective not only yields limited perception – it can also lead to very bad results.

“Information Governance” has become an overused buzz-phrase, often trotted out as marketing mumbo-jumbo for selling technology tools.  In all the hype one can easily lose track of what it really means.  At its heart, Information Governance is no more – and no less – than making sure the organization sees the big picture of information compliance, cost, risk, and opportunity when making strategic decisions.

The Information Governance perspective is a ready-made, scalable resource. Any organization can make meaningful headway, right away, by simply adopting an inclusive IG perspective when addressing information matters, before investing in significant organizational changes and expensive technology tools.

What does this mean? Simply this – whenever any information-related issue is dealt with or decision will be made by your organization, be sure to ask the following:
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Weird SportAs you toss and turn in bed, you picture yourself on a strange playing field with other athletes swirling around you.  You have absolutely no idea what sport you are playing, nor a clue what the rules are.  It all feels beyond embarrassing, and downright dangerous.

This is not just a bad dream – it’s the reality for companies possessing third-party data without clarity on what rules and responsibilities apply.

Most companies possess some data that they do not truly and solely own.  Perhaps your company signs a nondisclosure agreement and obtains others’ information while evaluating a business opportunity.  Or maybe your company is a service provider that receives or generates data on behalf of customers or clients.  Your company has possession of the data, but it remains responsible to the third-parties if there’s a problem.

What kinds of problems? Well, what if the third party’s data is lost, corrupted, misappropriated, hacked, or held for ransom?  What if the cost of maintaining the information, after the work concludes or need passes, becomes onerous?  What if the information becomes relevant in future litigation?  Who is authorized to make decisions about the information when the unexpected happens, and who is responsible for the expenses and exposures?

Information Governance – your organization’s strategic approach to managing information compliance, cost, and risk while maximizing information value – is tailor-made for this commonplace scenario.  Here’s how it works:
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Lightning Strike in ThunderstormIf you’re old enough, you’ll remember a time when businesses actually kept their own information (cue my adult children to roll their eyes). How quaint.  We no longer keep most of our information – providers do that for us.  We store our data in the cloud, with cloud providers. We outsource business applications to SaaS providers, and even entire systems as PaaS.  And we increasingly use service providers to handle key aspects of our business that we used operate internally, resulting in a robust flow of data out of our businesses to such providers, and also the providers generating, receiving, and retaining huge troves of business data on our behalf.

But we’re still accountable for our information in others’ hands:

  • Litigation – the scope of permissible discovery, and of the preservation duty, extends not only to data in our possession or custody, but also to data within our control.       
  • Data security – we’re generally responsible for data breaches suffered by our service providers.  Under most breach notification laws, including HIPAA and state breach notification statutes, our service providers must notify us of data breaches, but we are still responsible for providing notice to affected individuals and regulators.  Regardless, in the wake of a service provider data breach, we’re in the hot seat.
  • Business Continuity – if we need to promptly restore data due to ransomware or other causes of business interruption, it doesn’t matter who’s the custodian – all that matters at that moment is timely and effective restoration.
  • Retention – third parties retaining information longer (or shorter) than our retention schedule cause us to be at best inconsistent and out of compliance with our information management policies.  At worst?  See Litigation, Data Security, and Business Continuity above.

Our litigation preservation duties do not vanish for information hosted elsewhere but still in our control; our data security obligations do not evaporate when we house protected data with a service provider; our imperatives of data integrity and accessibility have no exceptions based merely on data storage location; and our records retention and destruction rules do not disappear if our data is hosted remotely. In other words, we still need to govern information compliance and risk for our business data in other’s custody.

And this is a perfect example of the value of Information Governance. A key benefit of the IG perspective is that it enables organizations to take useful strategies from one established discipline and apply them more broadly. The importance of service provider controls is well-established in the data security discipline. For example:
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A metal cattle brand with the word brand as the marking areaThe “business case” for information governance often focuses solely on quantifying specific costs for data management and exposures for data security and ediscovery.  Number crunching is of course important, but it misses something bigger, more strategic, and ultimately more crucial to the organization – its brand.  Companies, regardless of industry, are fundamentally in the information business.  It follows that how an organization manages its information assets reveals how the organization manages itself.  And that matters, a lot, because companies that align themselves with their brand, achieving brand discipline, are more successful.

In their seminal 1993 Harvard Business Review article, Customer Intimacy and Other Value Disciplines, Michael Treacy and Fred Wiersema made the case for how highly successful companies (1) understand and redefine value for their customers, (2) build “powerful, cohesive business systems” to deliver more of that value than their competitors, and (3) raise their customers’ expectations beyond what the competition can deliver.  The most successful companies do this work within at least one of three disciplines: operational excellence, product leadership, or customer intimacy.

Treacy and Wiersema based their insights on an intensive study of 40 companies that achieved breakout success in their markets.  They followed the article with their quintessential business strategy book The Discipline of Market Leaders.  Twenty years later, this book is likely still on your CEO’s bookshelf.

What’s the point for information governance?  It’s this – a successful company brand cannot be lipstick on a pig.  It must be organic, a discipline that pervades the organization from the bottom to the top, inward and outward, in its core processes, business structure, management systems, and culture.  And how your organization manages information value, cost, compliance, and risk is no exception.  Simply put, stronger information governance yields a stronger brand for your business.  And this is true for each of the three disciplines of highly successful companies:
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One Bullet in Gun BarrelHaving too much data causes problems beyond needless storage costs, workplace inefficiencies, and uncontrolled litigation expenses.  Keeping data without a legal or business reason also exacerbates data security exposures.  To put it bluntly, businesses that tolerate troves of unnecessary data are playing cybersecurity roulette … with even larger caliber ammunition.

Surprisingly few U.S. data security laws and standards expressly require that protected data be compliantly disposed of once legal and business-driven retention periods expire.   PCI DSS v3.2.1, Requirement 3.1, provides “[k]eep cardholder data storage to a minimum by implementing data retention and disposal policies ….”  HIPAA regulations  mandate that business associate agreements require service providers, upon contract termination, to return or destroy all PHI received or created on the covered entity’s behalf, if feasible.  Alabama and Colorado require that records containing state-level PII be disposed of when such records are no longer needed.  And biometric data privacy laws in Illinois, Texas, and Washington generally require that biometric data be disposed of once it has served its authorized purpose.

Instead, most such laws and standards focus on securely sanitizing or destroying storage media.  For example, the NIST Cybersecurity Framework v. 1.1 includes as a security control (PR.IP-6) that “[d]ata is destroyed according to policy,” and ISO 27002 (§ 8.3.2) provides that “[m]edia should be disposed of securely when no longer required, using formal procedures.”

But data security is not achieved by simply running through a checklist of explicit compliance requirements – it instead requires assessing risks and establishing effective security controls.  And one of the most powerful security controls is to not keep too much data, for too long.
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Hands pointing towards businessman holding head in hands Being a CISO is a tough gig.  The perpetual deluge of news items on hack after hack, breach after breach, has finally conveyed that data security is an imperative for all companies, large and small.  But the perception still lingers that the Chief Information Security Officer (or her InfoSec team) will single-handedly prevent breaches at “our” company – and if one should occur, will take care of the response.  For some CISOs, it may feel like High Noon, all over again.

This is unfair to the CISO, and wrong on at least two counts.  First, regardless of the CISO’s job description, the full range of cyber risk exceeds the scope of the CISO’s practical control.  Second, effective breach response requires up to ten channels of coordinated activity, and nine of the ten fall outside of the CISO’s authority.
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Depressed employee with laptopMost people have elevated stress during the holiday season — work, travel, family, money, time.  And holiday stress can make people inattentive, tired, frustrated, and willing to take short cuts, especially when it comes to computer and Internet use.  This is when mistakes happen.  It’s when we decide to evade policy by emailing work home or by using the unsecured airport Wi-Fi because our plane is delayed.  It’s also when malicious acts of information theft, sabotage, and fraud can more easily occur and go undetected.

According to a recent survey, insider threats — as opposed to outside actors — can account for nearly 75% of cyber incidents.  These incidents occur because of the actions of employees, suppliers, customers, and previous employees.  Law firms are not exempt, particularly small to medium size firms.  In fact, smaller firms typically have fewer resources to devote to cybersecurity and use more outside suppliers.

End-of-year activities for law firms also make them especially vulnerable to insider threats, whether inadvertent or malicious: the push to bill and collect for more hours, time-sensitive legal matters that must be resolved before the end of the calendar year, attending to year-end tax accounting, case and client review, bonus calculations.  Lawyers and their staff feel the strain of extra hours, looming deadlines, and sometimes contentious clients at the same time we all feel holiday pressures at home.

What is at risk?
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Fish tempted by fishing hookAs technical security improves, human security vulnerabilities are increasingly in the bulls-eye.  For a fresh look at social engineering, and how best to defend against it, there’s no better source than a hacker.  So, I reached out to Cliff Smith, Ethical Hacker & CISSP at Parameter Security, for his take on the current social engineering battleground.  Here’s what he shared:

Confidence games have been around forever.  Is there anything fundamentally different about social engineering practiced by hackers?

Modern social engineering is no different than the classic con games.  They all run on information, trust, and emotions.  The biggest change in the past 20 years or so is that technology makes the attacker’s job much easier, for several reasons.  First, a skilled practitioner can use countless tactics to make their first contact appear more legitimate, such as spoofing a message’s source or creating a legitimate-looking website.  Second, the average user operates on autopilot much of the time when using their phones or computers.  It’s so easy, for example, to click on a link without stopping to think about the danger, which makes phishing attacks much more likely to succeed.  Third, technology makes the consequences of social engineering much more dire.  In just a few clicks, you can accidentally ruin your financial life, or someone else’s.

It’s commonly understood that phishing is a problem, and that phishing is a deceptive email with a malicious link.  Is it that simple, or are there other social engineering attacks to be concerned about?
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