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How the New Rule Applies to infotex

By Adam Reynolds | Monday, February 21, 2022 - Leave a Comment

(It does not)

But it’s “crazy complicated and seemingly circular.”
A new article meant to inspire thought about IT Governance…

Note: You can read the article where Adam discussed the rule itself here:
FDIC and OCC Release New Incident Notification Rules.

fox chasing its own tail

The new interagency Computer-Security Incident Notification Requirements rule includes requirements not only for banking organizations, but also their service providers.  Luckily, the rule clearly defines what those requirements are, and who they pertain to.  As the introduction to the rule states:  “The final rule separately requires a bank service provider to notify each affected banking organization customer as soon as possible when the bank service provider determines it has experienced a computer-security incident that has caused, or is reasonably likely to cause, a material service disruption or degradation for four or more hours.”

The rule then gets crazy complicated and seemingly circular, defining a bank service provider “as a bank service company or other person who performs covered services; provided, however, that no designated FMU shall be considered a bank service provider.”  An FMU , or Financial Market Utility, is defined by law as “any person that manages or operates a multilateral system for the purpose of transferring, clearing, or settling payments, securities, or other financial transactions among financial institutions or between financial institutions and the person.”

So we interpret the above to mean a bank service provider performs covered services, but is not a bank.

Adam Reynolds, CISSP
Lead Non-Technical Auditor

Following that, covered services are defined as services performed by a ‘‘person’’  that are subject to the Bank Service Company Act (BSCA).  The services covered by the BSCA include check and deposit sorting and posting, computation and posting of interest, preparation and mailing of checks or statements, and other clerical, bookkeeping, accounting, statistical, or similar functions such as data processing, Internet banking, or mobile banking services.

As a Managed Security Service Provider, we deliver network monitoring, event log consolidation and monitoring, and other services that do not fall into those categories.  Therefore, this new rule is only applicable to providers performing those services.  As infotex is a Managed Security Service Provider, we do not provide services covered by the BSCA and are currently not required to meet the expectations in the new rule.

See Dan’s take on this rule here!

Original article by Adam Reynolds CISSP. Lead Non-Technical Auditor, infotex

Interested in any of infotex’s services? Visit offerings.infotex.com to request information!



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