As heavily regulated entities by FINRA and the SEC, it is incumbent upon financial firms to maintain high client confidentiality. Being a part of the Coworking trend presents the opportunity for many such companies who desire Class A real estate and a more competitive location than they would get on their own. Is it too much of a risk to take? If you’re curious about jumping on the Coworking bandwagon, here are the risks and benefits you should consider.
According to Symantec’s 2016 Internet Security Threat Report, one out of every 40 small businesses are likely to suffer a cyberattack. (as cited in Sophy, 2016). Typically financial companies such as investment managers, RIA firms, and hedge funds are acutely targeted because hackers know they possess sensitive information such as investment account statements, banking statements, social security numbers, and credit card information for their clients. Some NYC coworking space locations will offer access to Wi-Fi, but it may not be protected. This is particularly risky for companies using file-sharing because suffering a cyberattack may bring the entire company down.
In addition to cyber risks, there are physical dangers that go along with coworking spaces. Equipment may be stolen or lost and there are virtually no limits to what a hacker can retrieve from even a device whose information has been erased. Unless it’s shredded to a fine consistency, they can get information off the hard drive. Client financial information may inadvertently fall into the hands of an unauthorized person due to the communal nature inherent to Coworking. To heighten this risk, standard errors and omissions insurance policies may or may not cover such data breaches.
Does that mean that financial companies should shun Coworking NYC altogether? Not so, says Corporate Suites, a longstanding proponent of Coworking NYC. The private office space in NYC provider has hosted an extensive list of financial firms in its Manhattan workspaces over the last decade. Their clients, many of the top financial names on the street, choose from a selection of six Class A Manhattan locations that augment their luxury brands.
How does Corporate Suites protect its financial clients from attacks? As data security is a concern that worries many of their clients, the company provides a secure VLAN to each client for their data network (with firewalls) as well as secure 24/7 air-conditioned server rooms. Further, each client has a locked private and sound insulated office space.
Now that you’ve heard both sides of the story, would you take the risk? Is a financial firm really throwing caution to the wind by participating in the coworking movement? Offer us your opinion below.
Sophy, Joshua. (2016, April 28) 43 Percent of Cyber Attacks Target Small Businesses. Retrieved from https://smallbiztrends.com/2016/04/cyber-attacks-target-small-business.html