How to Mitigate Fourth Party Vendor Security Vulnerabilities

Third-party vendor security is a part of most organizations’ cybersecurity protocols, but what about fourth party vulnerabilities? Fourth party vendors are the vendors of your vendors and are often overlooked by corporations in conducting risk assessments and building their cybersecurity plans.

However, failing to address the information security of these vendors leaves your business at the mercy of the security measures of your third-party partners. Therefore, if your third-party vendor isn’t taking the right measures to protect their data from the vendors they work with, your business could be caught in the crossfire of fourth party data breaches, unauthorized disclosures, ransomware, data stealing malware, or other security incidents. 

Below are some of the ways your business can successfully identify and mitigate fourth party vendor vulnerabilities to protect against costly incidents. 

Understand Your Risk

To successfully mitigate cyber risk, it’s imperative to first get a full picture of potential risk factors. You should start by seeking a greater understanding of what types of data and data elements your third-party vendors have access to, how it’s being stored, where it’s going, and how it’s being processed. 

Ask your third-party vendors, “Do your vendors have access to our data?” and “Have they been authorized to transmit, process, or store our sensitive data?” If the answer is yes, it’s critical for you to understand the specific services and functions that are being outsourced from a third to a fourth party. You may also want to consider updating your contract agreements with your third-party vendors to address restrictions around third parties outsourcing your data for the services they are providing. 

In a perfect world, your third-party vendors’ security measures would be enough to protect you from any fourth party data breaches, unauthorized disclosures, ransomware attacks, and more, but that is unfortunately not always the case.

Learn More About Your Fourth Parties

Visibility is key to mitigating your fourth party cyber risk factors. You should make a point to gain awareness about who exactly your fourth party vendors are to best identify the security risk they may pose. Do you know where they are physically located? What software do they use to aid your third-party vendors? Find out. 

If you can’t establish a direct line of communication with fourth party vendors, turn to your third-party vendors for this information. This may even lead to discoveries of vendors that the fourth parties are using that your third-party partners weren’t aware of.

Next, you should request all security compliance documentation related to those fourth parties. These can include Service Organization Control (SOC) reports, which provide information related to vendors in use to make sure you have the full picture. 

Gain Clarity on Your Vendors’ Risk Management Programs

While your third-party vendors should already be a part of and privy to your cybersecurity management plans, that doesn’t mean your standards are being translated to their partnerships with fourth party vendors.

It’s critical to gain a better understanding of what their own corporate risk management programs look like, including how they vet their vendor partners. Do they have a business continuity plan? Do they have a notification system in place to alert you if a fourth party vendor with visibility to your business has a breach? These are questions you need to ask now to ensure you are collaborating on a plan that won’t leave your business vulnerable. 

For further protections, consider inviting your third-party vendors to your incident response training, and including a scenario that features a fourth party data breach. This will ensure that not only your internal team but also your partners are able to respond appropriately to reduce impact on the organization in the event of a fourth party security incident. 

Not understanding the risks associated with fourth party vendors can lead to serious and expensive consequences, including running afoul of regulatory requirements and facing penalties from governing bodies. 

Familiarizing yourself with your fourth party vendors and setting clear security expectations with your third-party partners is the best way to mitigate risk. 

ABOUT THE AUTHOR

Deb Bond is a Consulting Manager at The Bonadio Group with over two decades of successful experience in IT, Cybersecurity, and IT Audit. Deb focuses on building strong relationships and helping businesses shield their critical data at every intersection of the information exchange. Some of her specialties include collaboration to build robust, PCI-compliant solutions, Information Security Policy design, ISO 27001 support, implementation, and audit, and helping companies reduce the risk of supply chain attacks through due diligence and application of policy, process, and technology. A strong proponent of mentoring and education, Deb is President of the Information Systems Security Association (ISSA) Phoenix Chapter.