Why Cybersecurity Has Become a Core Compliance Risk

Cybersecurity has climbed to the top of every executive agenda, and with good reason. The modern threat landscape moves fast, AI-driven fraud is growing in scale and impact, and regulatory expectations are tightening across financial services. What was once treated as a technical challenge is now a strategic business risk that directly affects reputation, operations, and investor trust.

In this piece, we’ll explore why cyber and fraud threats are intensifying, how regulators like FINRA are responding, and why a fragmented set of vendors, even those offering point AI solutions, may actually increase risk for RIAs, private equity firms, and broker-dealers. We’ll also look at how a unified compliance approach can reduce that risk by embedding cyber and fraud awareness directly into everyday oversight workflows.

The escalating threat landscape: facts and figures

The numbers behind today’s cyber and fraud landscape make the shift impossible to ignore. Recent estimates project that global cybercrime costs will exceed $12.2 trillion annually by 2031. Meanwhile, global cybersecurity spending is expected to surpass $520 billion annually by 2026—a signal of how hard it’s become to keep up. AI is accelerating many of the threats driving that spending. Attackers can now use widely available models to scale social engineering, impersonation, and fraud, including deepfakes and real-time voice cloning, trends that appear with increasing frequency across industry threat research and advisories.

For most financial firms, these risks don’t surface first in a security operations center or an infrastructure dashboard. They surface inside everyday compliance workflows. Personal trading reviews miss suspicious timing because context lives elsewhere. Gifts and entertainment disclosures arrive too late to be meaningful. Political contributions slip through manual checks. Marketing materials are reviewed without full visibility into prior communications or supervision history. Cyber and fraud risk becomes operational risk when compliance teams lack the context, automation, and cross-system visibility to identify issues early.

The reality is that AI accelerates both offense and defense. When detection, supervision, and response signals live in fragmented systems, firms lose time and context, and that’s exactly what modern attackers exploit.

FINRA cybersecurity expectations for compliance teams

Regulators are responding to this shift, and financial services firms can’t afford to ignore it. The Financial Industry Regulatory Authority (FINRA) has expanded its cybersecurity and fraud prevention activities to help member firms improve risk management, resilience, and threat readiness.

FINRA’s recent initiatives include establishing a dedicated Financial Intelligence Fusion Center to collect, analyze, and disseminate real-time cyber and fraud threat intelligence to firms, expanding curated information sharing tailored to different business models and vendor environments, and offering tabletop exercises and practical tools to help firms prepare for and respond to cyber and fraud incidents.

FINRA has been clear that cybersecurity and fraud are among the most significant risks facing investors, markets, and member firms. While existing tools and programs have been impactful, FINRA has emphasized that more coordinated, real-time approaches are required to keep pace with evolving threats.

In practice, this regulatory focus signals a broader shift toward integrated oversight. Cybersecurity and fraud risks intersect with core compliance responsibilities, including employee conduct oversight, communications supervision, vendor due diligence, and incident response planning. Firms are being pushed to demonstrate not just that controls exist, but that they operate together.

Why fragmented vendor stacks undermine resilience

A Gartner study shows internal audit leaders are prioritizing cybersecurity, data governance, and regulatory compliance in 2026, reflecting how interconnected these risks have become.

In practice, many firms operate across multiple environments and tools, which increases complexity and slows response. IBM found that breaches involved data distributed across multiple environments took the longest to identify and contain, reflecting the added complexity and uncertainty of these incidents. 

This fragmentation is especially costly for compliance teams. Personal trading systems don’t connect to communications archives. Gifts and entertainment reviews lack insight into related emails or messages. Vendor due diligence lives in spreadsheets disconnected from access controls and supervision tools. Marketing reviews happen without full visibility into prior disclosures or regulatory history. Each gap introduces delay, manual effort, and blind spots, widening the window attackers rely on.

In security, risk isn’t just about what a system can detect. It’s about how quickly and consistently an organization can act. Point tools without integrated workflows extend the time attackers have to escalate impact.

Cyber and fraud as a time-and-friction game

One useful way to frame cybersecurity and fraud, particularly in financial services, is as a time-and-friction game. Attackers race to exploit opportunities faster than defenders can respond. The defender’s advantage comes from adding friction at the right decision points, forcing attackers to slow down, make mistakes, or expose themselves.

Meaningful friction shows up in areas like identity controls and step-up verification, cross-system behavioral analytics, alerts triggered by combined signals across trading activity, communications archives, and employee conduct, and automated workflows that initiate investigation and escalation playbooks.

Friction doesn’t mean creating a poor user experience. It means applying resistance strategically, informed by real-time context. A single fragmented AI feature might surface an alert, but without integration into compliance workflows and response logic, it doesn’t materially raise the barrier for attackers.

Toward a unified approach: why total solutions matter

If fragmented systems widen attacker windows, integrated compliance platforms shrink them. A unified approach starts with the workflows compliance teams already manage every day, including Code of Ethics reviews, personal trading oversight, gifts and entertainment, political contributions, marketing approvals, vendor due diligence, communications archiving, and compliance calendars. When cyber and fraud signals are embedded directly into these workflows, teams gain context that isolated tools can’t provide.

In practice, this means suspicious trading activity can automatically trigger a Code of Ethics review. Anomalies in archived communications can inform heightened supervision of related marketing materials. Vendor risk assessments can influence access controls and ongoing monitoring rather than living in static documents. Real-time threat intelligence from regulators or industry groups can feed directly into response playbooks instead of sitting in unread PDFs.

This is where cyber resilience gains operational traction, not through more tools, but through cohesive workflows and shared context that reduce response time and uncertainty.

Cyber is now an operational compliance risk

Cybersecurity and fraud are no longer sidebars to business operations. They are central to operational resilience in financial services. Regulators like FINRA are expanding both their expectations and their support. Threats continue to grow in volume and sophistication. AI-enabled attacks increasingly blur the line between technical incidents and compliance failures.

Fragmented, disconnected systems, no matter how intelligent, cannot provide the unified defense posture this environment demands. What firms need is a compliance foundation where context, intelligence, and action are connected. Where cyber signals inform compliance workflows, and compliance controls reinforce cyber hygiene. That’s how firms reduce risk, shorten response time, and stay ahead of evolving threats.

If you’re exploring how to consolidate compliance tools and strengthen security without adding operational burden, reach out to Greenboard to learn how we’re building the next generation of compliance infrastructure.