How to Prepare for a GLBA Audit

Article GLBA

GLBA Audit Checklist

The Gramm-Leach-Bliley Act (GLBA) requires financial institutions to ensure the security and confidentiality of customer information. The GLBA applies to a wide range of financial institutions, including banks and credit unions, securities firms, insurance companies, mortgage brokers, loan servicers, other non-bank lenders, financial service providers, and any other entity that provides financial products and services to consumers.

Implemented by the Federal Trade Commission (FTC), the revised GLBA Safeguards Rule took effect on June 9, 2023. This extensive revision brought about updates to data security requirements applicable to financial institutions, encompassing all institutions of higher education falling under Title IV.

Failure to meet GLBA requirements can result in serious consequences for an organization, including significant fines and penalties, legal action, corrective actions and remediation measures, and reputational damage, among other penalties.

Auditors focus on verifying that financial institutions are not only compliant with GLBA but also actively engaged in protecting customer information. Here are the key areas auditors may examine and some general steps you can take to prepare for a GLBA audit:

  • Understand GLBA Requirements

    Familiarize yourself with the GLBA requirements, especially the Safeguards Rule, which mandates financial institutions to develop, implement, and maintain a comprehensive information security program. Visit our Insights library to access several practical articles about GLBA requirements and updates.

  • Confirm Your GLBA Scope

    Determine and review all systems and staff involved in the processing and handling of in-scope GLBA data. Ensure your inventory is well-defined and documented.

  • Conduct an Assessment

    Perform a thorough assessment to gauge the security of your information systems and evaluate potential Auditors will assess whether the institution has identified and assessed potential risks to the security, confidentiality, and integrity of customer information and whether appropriate safeguards have been implemented to mitigate these risks.

  • Develop a Comprehensive Information Security Program

    Establish and implement a thorough information security program that addresses the identified risks. This program should include policies, procedures, and controls designed to protect the security and confidentiality of customer information. Auditors will review the organization’s information security program to ensure it is comprehensive, written, and implemented.

  • Designate a Qualified Individual

    Appoint a qualified individual responsible for overseeing and coordinating the information security program. This person, who is often the Chief Information Security Officer (but role is not specified in the Safeguard’s Rule), should ensure that the program is effectively implemented and regularly updated.

  • Administer Employee Training

    Provide employee training that promotes a culture of information security that emphasizes the importance of safeguarding customer information and the specific policies and procedures in place to achieve this. Consistent training ensures that employees not only have awareness of security practices but actively apply those measures in their day-to-day activities.

  • Execute Access Controls

    Implement access controls to restrict access to customer information based on the principle of least privilege, confirming that only authorized personnel have access to sensitive data. Auditors will anticipate discovering evidence indicating that your risk assessment aligns vulnerabilities and threats with a corresponding control. Physical security measures, such as access controls to facilities where customer information is stored, will be evaluated to ensure that unauthorized individuals cannot access sensitive areas.

  • Perform Regular Security Audits and Monitoring

    Conduct regular security audits and penetration tests to assess the effectiveness of your information security program. Implement continuous monitoring to detect and respond to security incidents promptly. Auditors will seek proof of consistent security audits, assessments of vulnerabilities, and ongoing monitoring to swiftly identify and react to security incidents.

  • Develop and Test Your Incident Response Plan

    Design an incident response plan (IRP) to outline the steps to be taken in the event of a security incident. This plan should include procedures for notifying customers and appropriate authorities if a data breach occurs. Test your IRP by performing a tabletop exercise to pinpoint potential gaps in your plan, assess the communication skills of your team, and identify any additional resource needs. Auditors will review the incident response plan to verify that the institution has a well-documented and effective plan in place to respond to and mitigate the impact of security incidents, including data breaches.

  • Implement a Vendor Management Program

    If you use third-party service providers, ensure they also adhere to security practices. Execute a vendor management program to assess and monitor the security practices of your Auditors will evaluate the vendor management program to verify that third-party vendors comply with security practices and that proper due diligence is carried out.

  • Maintain Documentation

    Maintain thorough documentation of your information security program, risk assessments, policies, and procedures, which will be crucial during the audit process. Auditors will review documentation related to training records, policies, procedures, risk assessments, and the overall information security program.

  • Review Policies and Procedures

    Keep your information security program up to date by regularly reviewing and updating policies and procedures in response to changes in technology and business operations. Auditors will focus on ensuring that an organization’s policies and procedures are comprehensive, current, and effectively implemented.

It’s important to note that GLBA compliance is a continuous process, and organizations should regularly assess and enhance their information security practices to adapt to evolving threats and regulatory requirements.

Organizations subject to GLBA need to take compliance seriously and implement robust information security programs. Regular assessments, audits, and training programs can help ensure ongoing compliance and mitigate the risks associated with non-compliance.

With our certified experts, CampusGuard would like to be your consulting partner in navigating the complex regulatory landscape and assist your organization in achieving and maintaining GLBA compliance. Contact us today to get started!

Download our GLBA Compliance Checklist.


About the Author
Kathy Staples

Kathy Staples

Marketing Manager

Kathy Staples has over 20 years of experience in digital marketing, with special focus on corporate marketing initiatives and serving as an account manager for many Fortune 500 clients. As CampusGuard's Marketing Manager, Kathy's main objectives are to drive the company's brand awareness and marketing strategies while strengthening our partnerships with higher education institutions and organizations. Her marketing skills encompass multiple digital marketing initiatives, including campaign development, website management, SEO optimization, and content, email, and social media marketing.