Financial Services Compliance - SOC 2 and Other Requirements

In the financial industry, data security is business security. Whether you're a fintech provider, asset manager, or payment processor, your clients trust you with their most sensitive financial data. Demonstrating that you can protect that data is no longer optional—it's essential.

SOC 2 (System and Organization Controls Type 2) provides a recognized, independent assurance that your systems are secure, available, and operating with integrity. It proves to clients, partners, and regulators that your business can be trusted.

SOC 2 is an auditing framework developed by the AICPA (American Institute of CPAs). It's designed to assess how your organization handles customer data based on five Trust Services Criteria:

1. Security - Protection against unauthorized access.
2. Availability - Systems are operational and accessible as promised.
3. Confidentiality - Sensitive information is properly safeguarded.
4. Processing Integrity - Systems perform accurately and reliably.
5. Privacy - Customer data is collected, used, and retained appropriately

While SOC 2 Type I evaluates design at a point in time, SOC 2 Type II evaluates the operational effectiveness of controls over a 3-12 month period—making it the industry gold standard for long-term assurance.

Failure to adopt and maintain strong security and compliance programs can lead to:

• Data Breaches - Resulting in financial fraud, identity theft, and regulatory exposure
• Lost Deals - Many B2B clients require SOC 2 reports before signing contracts
• Investor Hesitation - Security risk is a material factor in due diligence and valuations
• Reputational Damage - A public breach or compliance failure erodes market confidence
• Fines and Penalties - Regulatory bodies may enforce fines for failure to implement appropriate safeguards

How Penn|Parsons Helps You Achieve SOC 2 Readiness

Achieving SOC 2 compliance requires more than a checklist—it demands a coordinated effort across technical, administrative, and procedural domains. At Penn|Parsons, we simplify this journey with hands-on expertise and scalable solutions.

Our Financial Security Services Include:

• SOC 2 Gap Assessments & Readiness Planning
• Policy Development & Documentation for All Trust Criteria
• Cloud & Infrastructure Hardening (AWS, Azure, On-Prem)
• Continuous Monitoring, Logging & Alerting Systems
• Access Control, Identity Management, & Encryption Strategies
• Internal Audit Preparation & Support During Third-Party Reviews
• Ongoing Compliance Monitoring & Annual Review Support

Technical Controls That Matter in Finance

• End-to-End Encryption of client financial data at rest and in transit
• Role-Based Access Controls (RBAC) with least privilege enforcement
• Multi-Factor Authentication (MFA) for internal and client systems
• Real-Time Log Aggregation and SIEM Integration for threat visibility
• Disaster Recovery & Business Continuity Planning in line with availability criteria

In addition to SOC 2, your business may be subject to CCPA, GLBA, or NYDFS 500, all of which are U.S.-based regulatory frameworks, but they apply differently depending on the type of business, location, and data involved:

CCPA (California Consumer Privacy Act)

• Applies to: Businesses that collect personal data from California residents
• Who Must Comply:
  Any for-profit entity doing business in California that meets any of the following:
• Gross annual revenue > $25 million<
• Buys/sells/shares personal data of 100,000+ consumers/households/devices
• Derives ≥ 50% of revenue from selling personal data
• Scope: Consumer rights (access, deletion, opt-out), data protection obligations
• Note: Expanded/enhanced by the CPRA (California Privacy Rights Act)

GLBA (Gramm-Leach-Bliley Act)

• Applies to: Financial institutions in the U.S.
• Who Must Comply: Banks, lenders, investment firms, insurance companies, tax preparers, and even some fintechs
• Scope: Requires implementation of a written information security plan (WISP), protects non-public personal information (NPI), includes safeguards and consumer privacy rules

NYDFS 500 (New York Department of Financial Services Regulation 23 NYCRR 500)

• Applies to: Entities regulated by NY Department of Financial Services
• Who Must Comply: Banks, insurance companies, mortgage lenders, crypto businesses, and other financial service companies operating or licensed in New York
• Scope: Cybersecurity program requirements, CISO designation, risk assessments, annual certification, incident reporting within 72 hours

At Penn|Parsons, we tailor financial regulatory compliance programs to the specific needs of your financial operations — whether you're preparing for your first audit or strengthening existing controls. We don't just help you achieve compliance—we help you build a more secure and trustworthy enterprise.