In October 2019, I authored an article titled: Ready or Not — Here Come the 2020s in which I offered my predictions for the decade ahead. Included on my list was the following: “The principle driver of cybercrime will evolve from direct financial gain to personal and political manipulation…. cyber criminals have shown a troubling talent for finding new ways to leverage technology. With the imminent launch of 5G wireless technology and the explosion of data it will create, cyber criminals will assuredly find exotic ways, both brazen and covert, to influence what we hear, see, and possibly do.” While the vast majority of cybercrimes still include a financial motive, events of the past month have proven all too well that cyber criminals can disrupt our everyday lives and influence “what we do.”
Given the events so far this year, one has to wonder if ransomware cyber-attacks is becoming the world’s new pandemic. While cybercrime has been a significant risk for years, recent attacks have been disrupting our everyday lives like never before. The May 2021 ransomware attack on Colonial Pipeline led to fuel shortages in some parts of the U.S., causing “panic buying” and an extraordinary surge in prices. More recently, cyber criminals hacked the systems of the JBS meat processing company creating concerns about meat shortages in the United States. High profile attacks are certainly not limited to the U.S.. Already this year, global victims have included Ireland’s health service and Japan’s FujiFilm among many others.
As CNN recently observed: “Ransomware is not new. But there is a growing trend of hackers targeting critical infrastructure and physical business operations, which makes the attacks more lucrative for bad actors and more devastating for victims. And with the rise of remote work during the pandemic, significant vulnerabilities have been revealed that only make it easier to carry out such attacks.” Director of the U.S. FBI Christopher Wray recently compared the recent spike in cyberattacks with the challenge the nation faced in the aftermath of the Sept. 11, 2001, terrorist attacks. In a Wall Street Journal Interview, he observed: “There are a lot of parallels, there’s a lot of importance, and a lot of focus by us on disruption and prevention,” … “There’s a shared responsibility, not just across government agencies but across the private sector and even the average American.”
Enterprises in every sector are vulnerable to the heightened cyber threats of 2021, and a full scale mobilization of the “lines of defense” is an urgent priority. However, there appears to be a paralysis of fear on the part of many internal auditors to wade too deeply into cybersecurity. The question I still hear too often is, “What can internal audit contribute?” I addressed this matter first in a 2015 Blog: Internal Audit Enjoys Home-field Advantage in the Fight for Cybersecurity. The advice offered to internal auditors then still has a lot of relevance today:
The fundamental truth about cybersecurity is that it is as much a business risk as it is a security risk, and it is imperative that our stakeholders understand this so that internal audit is sought out to provide the necessary assurance and advice in this critical area.
Perhaps there is reticence in leading the fight against cybercrime because of the high stakes involved or the potential for negative publicity around high-profile failures. But our profession has never been one to shrink from complex risks or hard tasks.
Here’s something that should provide some reassurance. There is a dirty little secret about cybersecurity risks that cybercriminals would rather we not know — we have home field advantage.
Cybercriminals have to come into our house, so to speak, so we have a natural advantage. In the large majority of cyber assaults, the cybercriminal does not know what we have of value, where to find it in the system, or what protections we have around that most valuable data. We do and, with proper planning, can force the attackers to play the game according to our rules. This knowledge should color our approach to creating the protocols that secure and protect our data.
Experts in data protection recommend a basic process to identify the most important information, what many refer to as the crown jewels of data. It is that data that must be protected at all costs, and it is up to internal audit to provide assurance to stakeholders that the processes in place to protect it are effective and efficient.
Organizations should begin by segmenting their data into three piles based on its value to the organization:
Information in that final crown jewels pile must be separated from the first two piles, isolated and protected. This allows for resources to be concentrated where they are most useful rather than generically spread across the environment. Once protected, it is up to internal audit to do what it does best — test for effectiveness and efficiency of controls and protocols, and provide management and the board with assurance about those protections.
Daimon Geopfert, national leader for security and privacy consulting at McGladrey, has been a strong advocate of encouraging internal audit to step up on cybersecurity matters. A popular speaker, including at a number of IIA conferences, Geopfert offers straightforward insights that help put the cybersecurity issues squarely in the internal audit camp.
According to Geopfert:
The other bit of good news from Geopfert is a figure rarely seen in media coverage of cybersecurity issues. Basic data protections through sound practices and policies will likely discourage 60 percent to 70 percent of hackers, many of whom are not overly skilled, significantly reducing cybersecurity risks. These practices, e.g. limiting access to sensitive information, appropriate patching and monitoring, encryption on mobile devices and media, third-party-vendor security reviews, etc., already should be on internal audit’s radar.
I’d like to hear your thoughts about what role internal audit should play in cybersecurity.