PLANADVISER - July/August 2022 - 2

publisher's note //
Being Cyber Aware
L
ast year, I flagged a data point in our annual
PLANSPONSOR Defined Contribution Survey
that surprised me. It said 98.8% of plan sponsors
agreed with the statement " I am confident that
sensitive participant data on our provider's recordkeeping
system is safe/secure from cyberthreats, "
with 63% of respondents across all asset sizes
saying they " strongly agree. "
It's hard to make sense of that sentiment in this
day of cybersecurity concerns-and of the perceived
trust of recordkeeping providers that it shows. I wonder, does this mean plan
sponsors are ignorant of the perceived threats, or just aware that there's little
they can do about the provider platform and how those vendors approach
cybersecurity and safety?
Whatever the case, I think it shows a need for a greater attentiveness and
focus on what can be done. It's an opportunity for plan advisers to take stock
of their own practice and educate plan sponsors about the need for vigilance.
Recently, one of the most viewed stories on our website discussed retirement
plan theft at the participant level-specifically speaking to the role of the recordkeeper.
A lawsuit was filed in the U.S. District Court for the Southern District of
New York, in which a former global director for customer marketing at ColgatePalmolive
alleged that thieves depleted her entire account balance of approximately
three-quarters of a million dollars. The lawsuit names the ColgatePalmolive
employee relations committee, plan recordkeeper Alight Solutions and
custodian BNY Mellon all as defendants. While an egregious instance, it is not
the only instance of money gone missing from a retirement plan.
Cybersecurity lapses can be costly for everyone involved. In the adviser
space, last year, multiple Cetera entities were charged a combined $300,000
in fines and penalties for failures in their cybersecurity policies and procedures.
These errors resulted in what the Securities and Exchange Commission
described as " email account takeovers, " which exposed the personal information
of thousands of customers and clients at each firm. Outside of the financial
services industry, these attacks happen daily and indirectly affect us all.
Advisers can remember that their role regarding cybersecurity can encompass
both helping plan sponsors ensure their plans and participants follow best
practices and helping employees on their own advisory team do the same. In
research from Tessian, 30% of employees said they don't think they personally
play a role in maintaining their company's cybersecurity. But the truth is,
everyone plays a role.
After all, most of the time the breaches are caused by human error. More than
half (58%) of employees have sent an email to the wrong person at work, and one
in four have clicked on a phishing email in their employee mailbox. While the
Tessian research says 43% of people have made mistakes at their workplace that
compromised cybersecurity, only 39% of employees said they're very likely to
report a security incident. If employees don't report errors or security concerns,
there are more likely to be problems and potential breaches and losses.
For those who don't have this front and center at their firm or in client discussions,
last year the Department of Labor's Employee Benefits Security Administration
issued new cybersecurity guidance for plan sponsors, fiduciaries, participants
and recordkeepers-reminding everyone of the need to be vigilant about
hiring and evaluating service providers, and their own online security practices.
It's a reminder that advisers must be aware of the increasingly sophisticated
cyberattacks and institute practices to ensure that their own firm, as well as
clients and participants, do not become victims. -Alison Cooke Mintzer, Publisher
publisher: Alison Cooke Mintzer
Alison.Mintzer@issmediasolutions.com
creative director: SooJin Buzelli
SooJin.Buzelli@issmediasolutions.com
managing editor: Judy Faust Hartnett
Judy.FaustHartnett@issmediasolutions.com
managing editor, planadviser.com
John Manganaro
John.Manganaro@issmediasolutions.com
editorial staff: Zachary Barnes, DJ Shaw, Karen
Wittwer, Noah Zuss
contributors: Beth Braverman, Elizabeth Harrison,
Michael Katz, Ed McCarthy, Judy Ward,
Rhea Wessel
surveys & research: Kimberley Gonzalez-Quiles,
Jackie Scott
design & production: Donna Bien-Aimé,
Alanna Jacobs, Maria Kofman, Samantha Yu
design contributor: Cherese Rambaldi
art contributors: Spencer Ashley, Tim Bower, Jam
Dong, Taylor Dow, James Heimer, Bill Mayer,
OYOW, Ryan Peltier, Tilda Rose, Marc Rosenthal,
Silver Orchid Photography, Allie Sullberg (cover),
Ellen Weinstein
strategy & operations: Michelle Lamison; Melissa
Groccia, Rebecca Moore
commercial director: Rob Reif
Robert.Reif@issmediasolutions.com
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chief financial officer: Allen Heery
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