This is an important notice for publicly traded companies and cyber professionals.

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This is an important notice for publicly traded companies and cyber professionals. Under the Securities and Exchange Act 1934 The Securities and Exchange Commission (SEC) charged Pearson a the UK based public company, with making misleading statements and omissions to investors following its 2018 data breach.

The SEC – Kristina Littman, Chief of the SEC Enforcement Division’s Cyber Unit.
As the order finds, Pearson opted not to disclose this breach to investors until it was contacted by the media, and even then Pearson understated the nature and scope of the incident, and overstated the company’s data protections,…….As public companies face the growing threat of cyber intrusions, they must provide accurate information to investors about material cyber incidents.

If there is any doubt that the SEC does not intend to progress enforcement actions against public companies relating to cyber, this maybe a case worth focusing on. Not because of the fact that the SEC has changed the company, but because of what they were charged for and their reach. The SEC claims that Pearson made factually incorrect statements about the attack, in their 2019 annual report.

This makes me believe that publicly traded firms are heading for a rough ride with ESG reporting and Cyber, using enforcement actions as the means to regulate. The SECs 2021 regulatory agenda includes ‘Cyber risk governance’ and with Federal Government already concerned about and regulating cyber. It’s likely to make its way into ESG reporting.

If you are traded on a US market then you will get oversight from a US regulator, under a regulatory regime which is increasingly cyber focused.

Ted Dziekanowski Jason Spezzano Brian McCarthy

#theaugustagroup‚ #theaugustaplan‚ #cybersecurity‚ #SupplyChainRiskManagement‚ #CyberRiskManagement‚ #compliance‚ #cyberinsurance‚ #insurance‚ #regulatorycompliance‚ #regulatoryoversight‚ #esgrisk‚ #cyberregulation‚ #esgreporting‚ #soc2‚ #defenceindustry‚ #esg‚ #defence

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