Emerging and expanding cybersecurity threats present family offices with challenges from all angles. Internal protections are critical, while cybersecurity issues at portfolio companies require external attention. The stakes are high, and, as the RSM US Middle Market Business Index 2021 Cybersecurity Special Report details, the problems intensified with the shift to remote work.
Ransomware, in particular, is problematic for family offices, according to Tauseef Ghazi, RSM’s security and privacy risk leader and the cybersecurity leader for the firm’s family office team. Data from the MMBI cybersecurity survey reflected this: 46% of executives at companies with annual revenue between $50 million and $1 billion reported in the first quarter of 2021 that they knew of a company targeted by a ransomware attack. That was up from 32% in Q1 2019 and 43% in Q1 2020.
“If a cybercriminal wants to make $100,000, would they go after a middle market company or a family office?” Ghazi said. “If you’re in the business of ransomware or wire transfer fraud, you’d probably target a family office environment because there is usually less monitoring and controls.”
Most family offices, regardless of complexity, can meet their cybersecurity needs by outsourcing managed security services, Ghazi said. That approach provides a family office with dedicated cybersecurity resources and staff without needing to own them.
The MMBI special report can help family offices understand emerging cybersecurity issues and trends that may affect their enterprise and investment portfolio, as well as steps to take to enhance security and privacy efforts.