Security Experts:

U.S Banks Required to Report Cyberattacks to Regulators Within 36 Hours

In less than half a year, banks in the United States will be required to notify federal regulators of serious cybersecurity incidents within 36 hours.

The final version of this cybersecurity incident notification rule was announced on Thursday by the Federal Deposit Insurance Corporation (FDIC), the Federal Reserve, and the Office of the Comptroller of the Currency (OCC).

The rule applies to banking organizations and their service providers, and it will take effect on April 1, 2022, with full compliance extended to May 1, 2022.

“FDIC-supervised banking organizations will be required to notify the FDIC as soon as possible and no later than 36 hours after the banking organization determines that a computer-security incident that rises to the level of a notification incident has occurred,” the agencies said. “The banking organization must provide this notification to the appropriate FDIC supervisory office, or an FDIC-designated point of contact, through email, telephone, or other similar methods that the FDIC may prescribe.”

“Security incidents” are incidents that result in actual harm to the confidentiality, integrity or availability of information systems. “Notification incidents” are incidents that cause serious disruption to operations, ones that prevent the bank from delivering its products and services, or ones that pose a risk to the stability of the financial sector. Examples provided by the agencies include computer failures, DDoS attacks or ransomware attacks.

Bank service providers will be required to report incidents to client banks in case banking services are — or are likely to be — disrupted for more than four hours.

The agencies noted that they want to avoid putting a burden on banks — organizations are only required to inform regulators about an incident, without also needing to provide a full assessment or analysis within the 36 hours.

“This new regulation is a reflection of the growing breadth of impact cyber attacks have on financial services,” commented James Hadley, founder and CEO of Immersive Labs. “Technology is no longer just a part of the industry, but the operating system on which the entire sector runs. Attacks now mean more than short term reputational and financial loss for a single institution, having the potential to spread through interconnected infrastructure with significant impact on people and business.”

“Such regulation will encourage the sharing of critical knowledge at a pace that will allow senior stakeholders inside interlinked organizations to respond more effectively. This kind of swift and collaborative response, coupled with regular exercising, will improve decision making and improve resilience across the board,” Hadley added.

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Eduard Kovacs (@EduardKovacs) is a contributing editor at SecurityWeek. He worked as a high school IT teacher for two years before starting a career in journalism as Softpedia’s security news reporter. Eduard holds a bachelor’s degree in industrial informatics and a master’s degree in computer techniques applied in electrical engineering.