Does Your Brokerage Firm Have Cyber Insurance? 10 Questions You Should Ask Your Broker
You have a right to know if your brokerage firm is serious about focusing their time and money on security measures, because the problem is only becoming greater each day. Here is a list of tough questions that you should ask your brokerage firm about their cyber security. If they don't have a good answer, maybe it is time to look for a new broker, because who cares more about your money than you? Nobody!
1. Does your brokerage firm have an Asset Protection Guarantee if your account is compromised and cash and securities are lost due to unauthorized activity?
2. If so, will I be covered 100% if lost due to unauthorized activity?
3. What type of authentication does your firm require for online trading accounts?
4. Has your firm ever been "hacked" and if so, did you reimburse your customers?
5. What specific controls are in place to ensure that only brokerage employees have access to the firm's data?
6. What policies and controls does the firm have in place to make certain that employees who leave the firm no longer have access to sensitive data?
7. Does your firm provide formal training programs to educate staff on cyber security?
8. Describe your firm's policies and processes for sharing information with other firms within the financial industry?
9. What forms of authentication are used by customers to access your firm's applications over the internet?
10. Please describe the measures, if any, your brokerage firm has established to prevent, detect, and guard against cyber-attacks?
As a brokerage client, you can help protect your account in three ways:
• Keep your personal identifying information and account information secure and confidential, because sharing your User ID, password, PIN, account number or other standard means of authentication with other individuals means you authorized them to take action in your account.
• Keep your contact information up-to-date to ensure that your brokerage firm contacts you in case of suspected fraud.
• Review your account frequently and your statements promptly and report any suspicious or unauthorized activity to your brokerage firm immediately in accordance with your Client Agreement.
Disclaimer: While every effort has been made to ensure the accuracy of this publication, it is not intended to provide legal advice as individual situations will differ and should be discussed with an expert and/or lawyer.For specific technical or legal advice on the information provided and related topics, please contact the author.