Why Cybersecurity Should Be a Top Priority for Family Offices

Family offices of all sizes are increasingly vulnerable to cyber threats that can compromise sensitive data, disrupt operations, and damage family reputation. As technology evolves, so do the tactics of cybercriminals, making it essential for you to remain vigilant and proactive in: 

• Safeguarding sensitive data, 
• Protecting private family information and proprietary investment data, and 
• Maintaining the trust of family members, partners, and stakeholders.

A single cyber incident can have far-reaching consequences, including financial losses, legal liabilities, and reputational damage.

Why family offices are attractive targets for cybercrime

Unlike large institutional investors, many family offices operate with lean teams and limited information technology infrastructure. This can make them especially vulnerable to cyberattacks, including: 

• Ransomware attacks — Family offices can be perceived as having both the resources and urgency to pay ransoms quickly to avoid reputational harm. 
• Business email compromise — Cybercriminals can impersonate trusted contacts to redirect wire transfers or access sensitive deal data. 
• Third-party breaches — Family office transactions typically involve multiple external partners, increasing the risk of compromised systems and shared data.

A strategic, scalable approach to cyber protection

Modern cybersecurity is not just about firewalls — it’s about aligning protection with your investment operations and family values. A risk-informed strategy should include: 

• Conducting risk assessments — Regular assessments help identify vulnerabilities in systems, processes, and personnel. These insights are essential for developing a cybersecurity strategy tailored to your family office’s specific risk profile. 
• Performing penetration testing — Simulated attacks can reveal weaknesses in your information technology infrastructure before malicious actors exploit them. Routine testing helps validate the effectiveness of your network’s defenses. 
• Implementing continuous monitoring and audits — Real-time monitoring and periodic audits help detect anomalies early and maintain effective controls as your family office grows. 
• Establishing data privacy policies — Clear, well-documented data privacy policies demonstrate a commitment to protecting sensitive information. 
• Enforcing access controls — Limiting access to sensitive data based on roles and responsibilities reduces the risk of internal breaches and data misuse. 
• Developing an incident response plan — A well-defined response plan enables swift action in the event of a cyber incident, limiting disruption and supporting a faster recovery. This plan should be tailored to your investment portfolio and family office organizational structure. 
• Training employees on good cyber “hygiene” — Human error remains a leading cause of breaches. Ongoing training empowers employees to recognize phishing attempts, social engineering, and other common threats. 
• Maintaining regulatory compliance — Staying current with state privacy laws is critical. Regular reviews of your systems and policies help support ongoing compliance.

How CLA can help with cybersecurity

Cybersecurity is not one-size-fits-all, especially for family offices managing complex portfolios and sensitive information. CLA can help you create a comprehensive cybersecurity strategy to provide your family office with the tools, expertise, and support needed to protect sensitive data and maintain a secure operating environment.