A Blueprint for Security and Compliance Success

In the advancing world of banking system transformations, the critical intersection of security and compliance often becomes apparent only after months of progress. However, the "we need to secure this project" moment should ideally occur before the project even takes off. To fortify this imperative, we advocate for the early involvement of Cyber Security and Financial Crime (FinCrime) experts, ensuring they are at the table from the project's inception.

Securing the Project: Early Inclusion for Lasting Protection

The cornerstone of any successful banking system implementation lies in proactive security measures. By involving Cyber Security and FinCrime experts at the outset, organizations can address potential vulnerabilities before they become critical issues. This proactive approach sets the tone for a robust security posture throughout the project lifecycle.

Securing the Data: A Strategic Approach to Privacy Compliance

Understanding the location of the data and how it's used is crucial for compliance with the organization's privacy policies. It's often best to use synthetic and obfuscated data in lower-order environments. Production data should only be introduced to higher-order environments in the project's end phases, and only once production controls can be placed on all environments containing product data. This ensures a seamless transition while adhering to compliance standards. Further, weekly reports submitted to the steering committee provide transparency, with any variances reported through standardized production processes.

System Security Setup: Navigating Regulatory Waters

Banking is a regulated industry, and many compensating controls must be implemented. Configuring the banking system should account for system access, role-based authorization, transactional limits appropriate to the roles, role-based overrides, and system activity audits. Care must be taken to ensure that individuals with multiple roles do not inadvertently acquire "super user" access, maintaining the integrity of the system.

Technical Security Testing Considerations: A Holistic Approach to Robustness

Nonfunctional testing, including security testing, is integral to system reliability. Key considerations include access controls, intrusion detection, and penetration testing. Addressing these aspects comprehensively ensures that the banking system is fortified against potential security breaches.

Ancillary Security and Certification: Proactive Compliance Integration

Certain components of the banking system, particularly in payments and FinCrime, require certification. Integrating these as early program requirements streamlines the certification process, minimizing delays and ensuring seamless compliance.

FinCrime Compliance: Safeguarding the Financial Ecosystem

FinCrime considerations are multifaceted, encompassing fraud prevention, detection, case management, reporting, anti-money laundering, sanctions, and politically exposed persons. These need to be part of the underlying compliance framework to align the system with broader financial system requirements, particularly in payments, card management, clearing, and settlements.

Conclusion

Security and compliance are not just add-ons; they are fundamental to the successful implementation of a new core banking system. By embedding these principles at the project's inception, organizations not only safeguard their operations but also lay the foundation for a resilient and compliant financial ecosystem.

What are your experiences with integrating security and compliance measures in banking system transformations? How do you think early involvement of Cyber Security and Financial Crime experts can impact the success of a banking system implementation? Share your thoughts in the comments below!

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