ProEquities, an independent RIA and broker-dealer hybrid with $16 billion in client assets, is rolling out a new cybersecurity platform to improve protection for the firm's 700 financial advisers.
Developed in a partnership with Entreda, a risk mitigation and compliance software provider, ProEquities will install software on every computer and mobile device ProEquities' representatives use to access client data.
The software will ensure ProEquities' data security standards are met, such as requiring that the latest anti-virus protections, firewalls and system updates are in place. It also requires the computer or mobile device to use data encryption, a passcode, a secure internet connection and screen locks.
Though financial services firms are aware they are increasingly targeted by hackers, many firms rely on a patchwork cybersecurity system that cobbles together several different vendors, according to Steve Youhn, ProEquities vice president and chief compliance officer.
By going with a single vendor that handles everything, even non-tech-savvy advisers can be confident they are protected.
"Our guys are wealth advisers. They shouldn't have to be Geek Squad employees too," Mr. Youhn said. "You can't pick up a newsletter, you can't look online and not read about hacks or fraudsters getting into accounts. Advisers want peace of mind, want to know they have the best protections in place. A lot of them don't know how to do that."
Entreda's technology features backend monitoring that will inform ProEquities within minutes if a computer or device isn't in compliance or if the software is removed.
Mr. Youhn said his firm is setting a new standard for cybersecurity, which he said is "absolutely, hands down" the greatest threat to financial services.
"Nothing is even a close second," he said.
Other risk management and compliance companies applauded ProEquities' efforts.
"This is really a step in the right direction," said Anupam Sahai the vice president of product management at Cavirin.
However, there are still risks involved with the end investor, he said.
"One challenge will be to ensure that their platform effectively protects the end user whether on a desktop, laptop, or smartphone," Mr. Sahai said. "There are a lot of moving parts and operating systems, and the worst that can happen is to create a false sense of protection."
Mr. Youhn acknowledged that ProEquities' platform won't touch end investors, but it will at least give them confidence that their reps are safe and secure when accessing data.
"The last thing we want to do, the last thing any adviser wants to do, is reach out to customers and tell them, 'my computer was hacked and they got information on your account,'" he said. "We're doing everything we can to put our reps in a position where [they] never have to make those calls."