New York Proposes First-Ever Cybersecurity Regulation For Financial Institutions

The New York Department of Financial Services recently announced a new proposed rule, which would require financial institutions and insurers to implement strong policies for responding to cyberattacks and data breaches. Specifically, the rule would require insurers, banks, and other financial institutions to develop detailed, specific plans for data breaches; to appoint a chief privacy security officer; and to increase monitoring of the handling of customer data by their vendors.

Until now, various regulators have been advancing similar rules on a voluntary basis. This is reportedly the first time that a state regulatory agency is seeking to implement mandatory rules of this nature.