Dealerships assessing risk from cyber attacks

Minimize the risks within your Financial Services Offices with a proactive cyber security strategy

YoIn today’s tech-driven world, robust cyber security measures are more critical than ever to survive a cyber attack and its potential multimillion-dollar impact.

Car dealerships are becoming prime targets for cybercriminals in part because they handle sensitive customer data, high-value transactions and operate with complex supply chain networks.

The automotive industry has recently experienced a surge in cyber attacks, posing significant challenges for dealerships.

Dealerships today are more than just showrooms and service centers; they are hubs of digital activity. From processing customer financial information for vehicle purchases to handling insurance details, they have access to a substantial amount of personal and financial data. This makes them lucrative targets for cybercriminals seeking to steal identities through phishing scams, perpetrate financial fraud, or even disrupt operations through ransomware attacks.

The interconnected nature of the automotive ecosystem also increases risks through third-party vulnerabilities.

Dealerships collaborate with numerous external partners and suppliers, each introducing potential security gaps that cyber adversaries could exploit. The Financial Services Office poses a key vulnerability in third-party risk management for dealerships.

Proactive cyber security measures

Addressing multifaceted cyber threats requires a comprehensive and proactive approach to cyber security and risk management.

Implementing effective cyber security protocols with begins securing dealership networks through regular updates and stringent firewall configurations, establishing separate, secure Wi-Fi networks for customer and operational use, and installing up-to-date antivirus software and strict access controls.

Equally important is fostering a culture of cyber security awareness among employees through regular training and education programs on phishing scams, social engineering tactics, and secure computing practices, empowering them to recognize and mitigate potential risks in their day-to-day operations.

Compliance with privacy laws is essential. At the federal level, the Personal Information Protection and Electronic Documents Act (PIPEDA) sets the baseline for privacy protection.

Several provinces have equivalent privacy legislation, such as the Personal Information Protection Act (PIPA) in Alberta and British Columbia and Quebec’s Act Respecting the Protection of Personal Informationwhich imposes additional requirements and protections for the use, handling, and disclosure of personal information, as well as breach reporting obligations.

Dealerships can also turn to industry associations at national and provincial levels for valuable resources and guidelines on cyber security. These associations, such as the Canadian Automobile Dealers Association (CADA), often publish frameworks and recommendations tailored to automotive retail, empowering dealerships to strengthen their defenses effectively.

Beyond preventive measures, readiness to detect, respond to, and recover from cyber incidents is equally essential. Establishing comprehensive emergency response, business continuity, disaster recovery plans, and an effective crisis communication plan ensures swift containment, minimal disruption, and preservation of stakeholder trust during challenging times.

Role of Financial Services Office

Auto dealerships depend on their Financial Services Department to facilitate financing, review optional protection, and complete the legal documentation necessary to finalize vehicle transactions.

With this reliance, however, comes a significant vulnerability: the threat of cyber attacks on these crucial service providers. Such attacks can have far-reaching consequences that impact not only the Financial Services Office themselves but also the dealerships they serve. An attack on a Financial Services Office could lead to data theft, exposing customers to identity theft and fraud, disrupting financing processes, and causing sales delays and customer dissatisfaction.

To mitigate these risks, Financial Services Departments should adhere to rigorous cyber security frameworks aligned with stringent Canadian regulatory standards. This proactive approach includes regular security audits, real-time threat detection, and rapid response protocols.

Some Financial Services Suppliers offer robust capabilities, with advanced tools and technologies capable of stepping in for critical systems like Dealership Management Systems (DMS) to assist dealerships in the event of a cyber attack. These suppliers significantly enhance dealership resilience and operational continuity by integrating sophisticated cyber security measures.

Transparency is crucial in Financial Services Offices’ cyber security practices, encompassing data protection approaches and incident response capabilities.

Dealerships should assess partners based on their track record in safeguarding customer data and managing cyber security incidents. Opt for a partner committed to ongoing cyber security enhancement through technology investment, training initiatives, and proactive risk management.

Key questions to ask when selecting a Financial Services Offices partner:

• What protocols and certifications do they follow?
• How do they handle sensitive customer data?
• What measures are in place to mitigate cyber risks?
• Do they have cyber liability insurance?

Ultimately, the commitment to cyber security and risk management is not merely a defensive measure but a proactive investment in safeguarding customer trust, preserving business continuity, and securing long-term viability.

By prioritizing robust cyber security measures and selecting partners with a strong security posture, dealerships can mitigate risks and maintain a secure environment for their customers and business operations.