Last week, news broke about a data breach from Snowflake, a data cloud platform.
Financial service institutions, including Alternative Investment Managers, use Snowflake’s platform to store and analyze vast amounts of sensitive corporate data and personally identifiable information (PII). Hackers exploited compromised user credentials to potentially impact about 165 of Snowflake’s clients.
Why is this important?
The Snowflake hack highlights the critical need to mitigate risks associated with third-party cyber vendors and emphasizes the importance of using multi-factor authentication (MFA), as well as other forms of password management whenever possible.
Investigators revealed that hackers did not exploit any misconfiguration or lack of controls on Snowflake’s part. Instead, a financially motivated cybercriminal group used malware to steal usernames and passwords from clients. The affected accounts lacked multi-factor authentication and many compromised credentials were stolen from other platforms.
Recommended best practices for Investment Managers
To mitigate the impact on your firm from a similar cyber attack, Drawbridge suggests taking the following actions:
- Treat cyber threats on your vendors as seriously as your own systems.
Don’t assume that vendors are attack-proof. Investment Managers have a responsibility to perform due diligence on their vendors and mitigate cyber risk if their vendor experiences an attack. - Always opt to use multi-factor authentication.
Relying solely on passwords, even those associated with high-profile vendors, leaves organizations vulnerable to attacks. - Don’t use the same password across different platforms, portals, and vendors.
Consider using a password vault to generate unique passwords for every account. This way, you don’t have to remember or write down all your different passwords. - Give minimum levels of access.
Not everyone needs to have admin privileges. When setting permission levels, make sure that only those with a legitimate business need to access the data are given permission. Ideally, the only people with access to the data are those who need it to do their job.
By adopting these practices, alternative investment managers can better protect their sensitive data and ensure compliance with cybersecurity regulations.
What’s next?
Protect your firm’s sensitive data with a Vendor Risk Assessment from Drawbridge. Our approach does the heavy lifting for you, without requiring your team to track down a due diligence questionnaire from every vendor.
In addition to our innovative solutions, our team of cyber experts on our Client Success team can offer tailored advice on how to build and optimize a robust cyber posture that meets expectations of board members, investors, and regulators.
Contact us today to ask about our Vendor Risk Assessment and other cyber assessments tailored for Alternative Investment Managers.
