NHI Security Challenges in Financial Services

The financial sector is one of the most highly regulated, and expensive to remediate when compromised.  The average cost of a data breach in the financial sector is $4.5 million and growing. This reflects the spiralling associated costs of detection, containment, recovery, notification, legal, regulatory, and reputational damage. 

Reputational damage is typically the most common result when a financial institution experiences a data breach. This harm can become costly if news about the breach spreads widely on social media or gets attention from media channels. Reputation harm can deal a serious blow to financial service providers, creating customer churn and retention issues. Since fixing a damaged brand image is a slow and difficult process, it’s crucial for financial services enterprises to develop an organizational framework inclusive of reporting procedures within its structure to handle cybersecurity operations. 

Since the financial services sector handles massive volumes of sensitive information across a wide variety and large scale of transactions, sensitive information must be secured but also accessible to a plethora of internal and external systems, commonly referred to as “Non-human identities”. Non-human identities serve as digital entities that facilitate machine-to-machine interactions and perform repetitive tasks without human intervention.  Some examples of non-human identities include API keys, OAuth tokens, service accounts, and system accounts.

Non-human identities (NHIs) represent access keys or secrets that control access to the machines, applications, databases and other components within cloud infrastructure. NHIs include API keys, OAuth tokens, service accounts, and security certificates. Unlike human identities, NHIs are not directly tied to humans but facilitate machine-to-machine communications and perform automated tasks without human intervention. They are crucial for managing workflows, integrating applications, and ensuring the continuous operation of digital environments. They are usually unaccounted for, unmanaged, and over permissive.

The following are key focus areas when determining a strategy for securing the NHIs that run financial services applications:  

1. Secure management of NHIs 

A variety of APIs are necessary to enable communications between various components of a financial service or set of services. It takes interactions between thousands of APIs to create a financial service,  making APIs a particularly large attack surface. Unauthorized entry to APIs can cause data breaches and transaction manipulation. If attackers find weaknesses in API endpoints, they exploit them to increase the scope and scale of their attacks, impacting businesses on a catastrophic scale. 

2. Service account management

Service accounts often have more permissions and are usually checked less than user accounts. If these accounts are not managed properly, attackers can exploit excessive permissions to wreak havoc across financial systems. Service accounts left without attention become perfect spots for misuse, potentially resulting in unauthorized entry to important systems and information.

3. Securing automated processes

Automated processes like CI/CD and GitOps pipelines require various permissions distributed across different applications and services in order to function. When these processes are compromised, they can be manipulated to cause harmful actions that don’t appear immediately. Automated processes without regular checks and balances lead to exploitation and bypassing of security measures, eroding software security for financial institutions.  

While it is often assumed that automation is complicated to deliver and costly, automation is simply about having event triggers and outcomes.  Whenever a specific event occurs, it triggers one or multiple outcomes.  This means building sophisticated automation processes simply means having the right informational triggers for events and the right APIs to execute outcomes.  

4. Third-party risks

Third-party services require permissions to integrate and function, introducing an additional dimension of infrastructure to secure. These Non-human identities (NHIs) used for routine integration functions pose a significant risk when partner vendors are compromised. Security breaches at third-party vendors could spread across multiple financial institutions, partners, and services, causing information leaks and operational disruption.

5. Compliance and regulatory challenges

As financial institutions are bound by strict regulatory rules including PCI DSS and GDPR, there are heavy penalties and legal dilemmas associated with mismanagement of NHIs. It’s challenging to ensure automated systems and service accounts follow the rules set by regulators, yet failing to meet necessary standards causes far greater financial and reputational damage to an institution.

Best practices for data security in financial services

The FinOps sector experiences unique security problems, as its data is very sensitive and its assets hold high value. With increasingly complex cyber risks, financial organizations need to have a strong security approach that goes further than simply meeting standards. They need advanced methods and automated software tooling to strengthen their protection capabilities and guarantee tough security.

Identity and Access Management (IAM)

IAM solutions are very important for handling human and non human identities in financial organizations. Entro’s platform provides dependable solutions for managing non human identities, offering features like adaptive authentication and federated identity management.

IAM In the financial services industry practices:

• Adaptive authentication: Establish adaptive authentication methods that evaluate risk according to the context, for example, age of the non-human identity, confidentiality of the resources it protects, and any exposures related to the non-human identity.
• Federated identity management: Utilize federated identity solutions to unify the management of non-human identities across various systems and applications. This minimizes the chances of managing credentials in an uncontrolled manner.
• Privilege Access Management (PAM): Apply tough rules on privileged non-human identities, deploying PAM solutions to supervise and control the use of privileged access and actions.

Entro ensures that API keys and OAuth tokens are properly managed and rotated to prevent non-human identity security attacks.

Go Beyond Zero-trust 

Unlike old security models that trust things inside the network boundary, ZTA uses a rule saying, “never believe, always confirm.”

Core Components of ZTA:

• Micro-segmentation: Implement network micro-segmentation to isolate critical systems and limit lateral movement by attackers.
• Continuous authentication: Continuously verify the identities and devices that access network resources using multi-factor authentication (MFA) and behavior-based analytics.
• Least privilege access: Make sure to set up access controls rigorously, so users and systems only get the minimum amount of access required for their roles.

While Zero Trust architectures secure access to applications from users, a similar approach can be taken for non-human identities in the form of privilege.  By restricting privileges associated with NHIs, not only can they be segmented at the network level, but they can be further segmented down to the individual tasks they perform and functions they serve.  While a general best practice for managing human identities across multiple IAM setups is to have a 1-to-1 creation of identities to human entities interacting with the organization, no such limit exists with NHIs.  Creating more NHIs with smaller scoped permissions reduces their overall vulnerability to compromisation.  

Advanced threat detection and response

Determining threats and enacting appropriate responses is a crucial part of maintaining a secure financial service.  Some common strategies for advanced threat detection include:

• Behavioral analytics: Use machine learning to create benchmarks for normal conduct and discover changes that might suggest harmful actions.
• Security Information and Event Management (SIEM): Connect SIEM systems to gather and study log information from all parts of the system. This allows for instant identification of dangers and handling of events.
• Endpoint Detection and Response (EDR): Use EDR solutions to track endpoints and observe any potentially dangerous behaviors. This provides an in-depth view of possible threats and allows for quick reaction.

When combined, these components make up what is commonly referred to as a “SOAR Platform”.  SOAR (Security Orchestration Automation and Response) Platforms play a key role in: 

• Incident response: automation for regular incident response tasks decreases reaction times and improves response times
• Management of vulnerabilities / patch management: rapidly deploying changes at a large scale requires automation 
• Forensics: Often additional information across a wide variety of systems is required to determine a root cause, impact scope, and action plan to go forward

These technologies are purpose-built for securing endpoints, users, and workstations, but with the right assistance they can help secure NHIs throughout an environment.  Since NHIs handle the vast majority of transactions and interactions within a financial service, it’s critical to detect and respond when something is wrong.  

As a cloud-native service, Entro Security’s Non-Human Identity platform is perfectly positioned to enable SOAR platforms with the tools they need to automate and resolve issues across the NHI lifecycle whenever and wherever they may arise.  Entro’s NHI-DR (Non Human Identity Detection and Response) capabilities integrate seamlessly with these systems, 

Encryption and data protection

The requirement for strong encryption to protect sensitive financial data is an absolute necessity. Financial institutions must make sure that data is encrypted in transit and also when it’s not moving (in transit or at rest).

Encryption best practices:

• End-to-end encryption: Utilize end-to-end encryption to safeguard data from its starting point to the end.
• Strong encryption algorithms: Ensure data integrity and confidentiality by utilizing industry-standard encryption algorithms like AES-256.
• Key management: Use reliable key management methods, like storing keys in vaults or hardware security modules (HSMs) and implementing automated policies for rotating keys. 

Entro’s platform automates the secure lifecycle management of non-human identities, including secure vaulting and streaming rotation, ensuring data integrity and confidentiality are maintained at all times.

Regulatory compliance and governance

To maintain compliance with financial regulations and ensuring strong governance practices are the basic components of a solid security position.

Key compliance focuses:

• Regulatory alignment: Keep security practices in line with financial regulations like GDPR, PCI DSS and FFIEC.
• Audit and monitoring: Perform scheduled audits and compliance checks to discover gaps and apply necessary corrections.
• Governance frameworks: Establish all-inclusive governance frameworks, like COBIT or NIST, to steer security rules and methods.

In order to effectively support and deliver compliant services, visibility is crucial to providing continuous monitoring and detection of abnormal behavior in non human identities and secrets, as well as the forensic capabilities necessary to supply auditors with necessary information.  Entro Security’s platform leads the market in visibility of non-human identities, secrets, APIs, and other machine identities throughout the technical stack of financial services, making stringent compliance requirements easily supportable.  

Incident response and business continuity

Readiness for security incidents is important for ensuring business continuity should such events arise. Some incident response best practices to safeguard a financial services business include: 

• Planning for Response: Create and keep a thorough plan of action that describes storage locations of non-human identities, templates to describe the severity of the incident, and steps to follow when an NHI is exposed.
• Readiness Drills: Arrange frequent response drills and scenarios to examine and reduce the reaction time to find and rotate an exposed NHI.
• Business Continuity Planning: Ensure robust business continuity plans are set up to fall back on in the event of an exposure 

Leveraging the power of Entro’s Non Human Identity Security platform makes it easy to secure financial institutions against evolving cyber threats and ensure compliance with stringent regulations. Book a free trial today and transform your cybersecurity posture.