BY MIKE GILMORE, CHIEF COMPLIANCE OFFICER, RESULTS TECHNOLOGY CAN ENHANCED DUE DILIGENCE HELP YOUR BANK AVOID CYBERSECURITY RISK? RESULTS TECH TALK Endorsed Partner Just as you have to complete due diligence before you buy a home, due diligence for banking vendors can make or break a partnership. Not completing enhanced due diligence (EDD) is like buying a house sight unseen and without doing an inspection! You never know what you might find. It only takes one cyberattack to cause serious damage to both the financial health of your bank and its reputation. That’s why cybersecurity for community banks, including proper due diligence and enhanced security measures, should be taken when evaluating vendors that provide services such as payment processing or loan origination technology. Let’s dive deeper into EDD and why it should be a priority when it comes to cybersecurity for community banks. What Is Enhanced Due Diligence? Enhanced due diligence is a process that goes beyond the standard due diligence of reviewing a vendor’s track record and financial information. It involves looking at certain activities or indicators that could pose additional risk to your institution, such as: • Strategies and goals • Legal and regulatory compliance • Financial condition • Business experience and reputation • Risk management • Information security When evaluating a vendor, it’s essential to be mindful of red flags that could indicate potential risk. Let’s work with the house analogy a bit more. If you have an inspection done and the results come back showing there are cracks in the foundation, you’re able to make a more informed decision about going forward with that property. 10 In Touch
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