Many believe that the SEC’s recent push to play a more active role in strengthening rules regarding cybersecurity is a direct result of the SolarWinds hack. Jamil Farshchi, the chief information security officer at Equifax, told Bloomberg News that the proposed rules would bring much-needed transparency to corporate leadership and require unprecedented accountability when it comes to cybersecurity. “We believe requiring advisers and funds to report the occurrence of significant cybersecurity incidents would bolster the efficiency and effectiveness of our efforts to protect investors, other market participants, and the financial markets in connection with cybersecurity incidents,” the SEC said in the proposal. According to the document, these policies and procedures are specifically designed to address cybersecurity risks by requiring companies to report significant cybersecurity incidents affecting the adviser, its fund, or private fund clients to the SEC.

In the document, the SEC proposes introducing new rules under the Investment Advisers Act of 1940 and the Investment Company Act of 1940 to require funds and advisers to implement new cybersecurity policies. This is the case with the Cybersecurity Risk Management for Investment Advisers, Registered Investment Companies, and Business Development Companies proposal, published on February 9. The SEC seems eager to change this as it spent the better part of 2022 introducing various proposals that - if passed - would require public companies to report on cyber attacks and incidents. However, a joint 2021 report showed that in 2020, only 17% of Fortune 100 companies surveyed reported cybersecurity issues to board members annually or quarterly. said that current disclosure requirements “erred on the side of nondisclosure” and often left investors in the dark when companies experienced hacks or other cybersecurity attacks.Ĭurrently, company management is only required to keep boards informed about cybersecurity issues, with no obligation to share them with investors or other customers.

In 2018, former SEC Commissioner Robert J. Introducing stricter regulation regarding cybersecurity disclosures isn’t a new effort from the SEC. The new rules would be implemented as amendments to various forms regarding cybersecurity disclosures and would specifically target investment advisers, investment funds, and business development companies. Securities and Exchange Commission (SEC) has proposed new cybersecurity risk management rules for corporations that would require them to be more transparent with customer disclosures.

Hacks for unturned