Cybersecurity Compliance: A Guide to Regulatory Requirements

cybersecurity compliance

Technology has been a critical player in the modernization of business and operations. Companies depend on it to drive efficiency and productivity. However, it comes with risk in the form of potential cyberattacks. Regulations rule how industries protect sensitive and confidential data. This is cybersecurity compliance and involves multiple rules depending on the industry and type of data.

Cybersecurity compliance requires a dedicated strategy and proactive measures like pen testing and vulnerability assessments. Let’s review all regulations and requirements.

What Is Cybersecurity Compliance?

Businesses collect, share, and use lots of data. It’s a necessity that’s core to their operational framework. How they do this matters regarding regulatory requirements. The gist of cybersecurity compliance is the adherence to agency, law, or authority group’s standards and regulations.

Consistently meeting these compliance rules necessitates risk-based controls that work to safeguard the confidentiality, integrity, and availability of data. It must always be in a state of protection, whether at rest or in transit.

Observing cybersecurity compliance brings about many challenges. Standards and requirements aren’t always explicit and may overlap. Additionally, there’s the ever-evolving threat landscape. What keeps hackers out today may be obsolete tomorrow. Noncompliance can also mean fines and reputational harm, so it’s imperative for organizations to make this a priority.

What Data Is Subject to Compliance Mandates?

On review of the regulations regarding data, the overall descriptor is that it’s sensitive. Three categories fall under compliance:

  • PII (personally identifiable information): Date of birth, name, address, Social Security number, etc.
  • PHI (protected health information): Medical history, insurance records, prescriptions, hospital admissions, diagnosis, etc.
  • Financial information: Credit card numbers, bank account information, PINs (personal identification numbers), credit history, etc.

Outside of these three main classifications, other data may also be in the purview of compliance:

  • Race
  • Religion
  • Marital status
  • Email addresses
  • Usernames and passwords
  • Biometric data (e.g., fingerprint, facial recognition, voice)

The Importance of Cybersecurity Compliance

You can never eliminate risk in the cyber world. What you do have control over is being on the offensive more than the defensive. Rigid controls and establishing best practices to limit risk also fall under compliance.

Any business can be a target, as cybercriminals are opportunistic. An attack has consequences in many ways, including the possibility of noncompliance. Industries that fall into these classifications — healthcare, finance, SaaS, medical device manufacturing — are often the most attractive to hackers.

To quantify this risk, keep these data points in mind:

  • On average, a data breach costs a company $4.45 million.
  • 66% of organizations experienced a ransomware attack in 2022.
  • HIPAA violation fines and settlements reached over $2 million in 2022.
  • 32% of all known data breaches between 2015 and 2022 were in the healthcare sector.
  • Financial breaches account for 10% of all attacks.
  • Research revealed 993 vulnerabilities in medical devices, a 59% increase from 2022.

In addition, many companies don’t have the proper foundational pieces to manage compliance. In fact, 77% don’t have an incident response plan.

This data demonstrates how common breaches, attacks, and noncompliance can be. You’re up against a lot without the regulatory pressures. However, you can remain compliant and secure with a robust and well-defined strategy.

So, what regulations require cybersecurity compliance, and what actions does your business need to take to meet them?

Regulations That Require Cybersecurity Compliance

These regulations require compliance with the usage of data and its security:

HIPAA

The most well-known cybersecurity compliance mandates come from HIPAA. HIPAA defines how healthcare organizations use data, specifically PHI. It has many rules regarding its security. Three HIPAA rules dictate the collection, handling, storage, and transmission of ePHI (electronic PHI).

HIPAA Security Rule

The HIPAA Security Rule states that healthcare organizations and their partners must comply with keeping PHI confidential, accessible, and secure.

HHS (Health and Human Services) OCR (Office for Civil Rights), the agency that enforces HIPAA, relays five points to consider in this rule:

  1. Assess risks and vulnerabilities regarding ePHI’s confidentiality, integrity, and availability.
  2. Commence regular reviews of HIPAA compliance.
  3. Designate how you create, maintain, receive, and transmit ePHI.
  4. Define how third parties, partners, and vendors with access to ePHI will create, receive, maintain, and transmit it.
  5. Identify data security threat risks in three categories: human (internal and external), natural (disaster events), and environmental (physical and cyber).

To meet these requirements, you’ll need a way to find and fix vulnerabilities — a HIPAA Security Risk Analysis (SRA). This exercise enables you to comply with Security Rule 45 C.F.R. Section 164.308(a)(ii).

HIPAA Privacy Rule

The HIPAA Privacy Rule documents the standards for the protection of ePHI. Within this rule, the landscape is privacy-focused. It outlines the parameters for using or disclosing ePHI. Within this framework, there will always be weaknesses, so you have to always be in the mode of finding these and resolving them to prevent a breach and noncompliance.

HIPAA pen tests are a best practice to avoid any adverse compromises. You’ll demonstrate compliance by finding and correcting vulnerabilities with a pen test.

Breach Notification Rule

The HIPAA Breach Notification Rule details what should happen during a breach. Thus, you must have a well-defined policy and incident response strategy. As penetration testing simulates attacks, they help meet this rule as well. The findings from the test offer insight into how well your defenses are working.

PCI DSS: Payment Card Industry Data Security Standard

PCI DSS is the Payment Card Industry Data Security Standard. It’s an information security standard that covers credit card information. The Payment Card Industry Security Standards Council (PCI SSC) governs it, and card brands require it. The PCI SSC doesn’t have the legal authority to mandate compliance. However, any company receiving credit card payments could not do so without meeting it.

Four levels of compliance make up PCI DSS. Each represents a dollar transaction amount, with Level 1 at the top. Every category necessitates a PCI scan. For Level 1 businesses, internal audits and scanning by an approved vendor are mandatory.

PCI certification also involves firewalls, encryption, and anti-virus installations. You also have to ensure the accuracy of audits and scans. Pen testing can support this compliance requirement.

SOC 2 Type 2

SOC 2 Type 2 stands for System and Organization Control (SOC). It provides a report regarding security, confidentiality, integrity, privacy, processing, and availability of data controls. Any organization that stores, uses, or transmits protected data should go through a SOC 2 Type 2 pen test.

A SOC 2 Type 2 pen test comprises five areas: security, availability, processing integrity, confidentiality, and privacy. The five are better known as the Trust Service Principles (TSP). The report from your SOC 2 Type 2 pen test will detail:

  • A list of tested IP addresses, URLs, mobile apps, and APIs
  • Identified vulnerabilities
  • What steps did those conducting the test use
  • The exploitable areas
  • Remediation recommendations with priority

These pen tests offer a way to be compliant and demonstrate that you have the correct security controls to protect data.

ISO 27001: International Organization for Standards 27001

ISO 27001 standardizes adequate and controlled measures to support information security. It focuses on three aspects: legal, technical, and physical. It’s a complex rule with many elements regarding security and business continuity. To remain compliant with ISO 27001, you must have at least one pen test annually.

Medical Device FDA Rules

Manufacturers of medical devices must comply with compliance requirements from the FDA (Food and Drug Administration). There are several regulations from the FDA. First is the Premarket Notification 510(k), which must include safety and effectiveness as well as cybersecurity standards.

In 2023, the FDA established new rules regarding medical devices and cybersecurity. Those regulations include:

  • Submission of plans relating to how the manufacturer will track and address cybersecurity issues once the device is available for use
  • Establishment of internal procedures about medical device security patches and updates deployment after the identification of vulnerabilities
  • Creation of an SOBM (software bill of materials) included in FDA filings that lists all software in the device
  • Compliance with newly created future rules

Medical device pen testing can satisfy these FDA rules. 

Financial Industry Regulatory Authority (FINRA)

FINRA institutes cybersecurity protocols for companies in the financial sector and securities firms. The organization helps them comply with the Securities Exchange Act of 1934 (17 CFR §240.17a-4(f)). This legislation mandates that organizations must keep electronic records in a non-rewriteable, non-erasable format. FINRA recommends that members use pen testing to meet this. It supports a risk-based approach to locating vulnerabilities and evaluating security.

Federal Educational Rights and Privacy Act (FERPA)

FERPA is a U.S. federal law covering the protection and privacy of students’ educational records. It applies to all educational institutions that receive funding from the U.S. Department of Education (DOE). Higher education is becoming a more appealing target for cybercriminals, so these organizations must stay ahead of them and comply with FERPA. Pen tests and vulnerability assessments help with these rules.

Address All Cybersecurity Compliance Requirements with Our Experts

Blue Goat Cyber has deep expertise in assisting companies with cybersecurity compliance. Through pen tests, vulnerability assessments, medical device software testing, and more, we help you stay compliant and secure. Contact us today to learn more.

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Christian Espinosa

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