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OIG Audit of FDIC Info System Security Issues

The FDIC’s Process for Identifying and Reporting Major Information Security Incidents, July 2016.
“Our audit focused on the FDIC’s processes for addressing one particular type of information security incident—a breach of sensitive information—because the incident we selected for detailed review (i.e., the Florida Incident) was a breach. The Florida Incident involved a former FDIC employee who copied a large quantity of sensitive FDIC information, including personally identifiable information, to removable media and took this information when the employee departed the FDIC’s employment in October 2015. The FDIC detected the incident through its DLP tool. Audit Results Although the FDIC had established various incident response policies, procedures, guidelines, and processes, these controls did not provide reasonable assurance that major incidents were identified and reported in a timely manner. Specifically, we found t hat:

  • The FDIC’s incident response policies, procedures, and guidelines did not address major incidents.
  • The large volume of potential security violations identified by the DLP tool, together with limited resources devoted to reviewing these potential violations, hindered meaningful analysis of the information and the FDIC’s ability to identify all security incidents, including major incidents.
  • Further, based on our analysis of the Florida Incident, we concluded that the FDIC had not properly applied the criteria in OMB Memorandum M-16-03 when it determined that the incident was not major. Specifically, the FDIC based its determination on various mitigation factors related to the “risk of harm” posed by the incident. Although such factors have relevance in determining the mitigation actions to be taken in addressing incidents, the factors are not among those listed in OMB Memorandum M-16 -03 for agencies to consider when determining whether incidents are major and, therefore, are not relevant. We notified the CIO on February 19, 2016 that our analysis of the Florida Incident found that reasonable grounds existed to designate the incident as major as of December 2, 2015, and, as such, the incident warranted immediate reporting to the Congress. The FDIC subsequently reported the Florida Incident to the Congress as major on February 26, 2016…”

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