New York (NYDFS) Cybersecurity Requirements – 23 NYCRR 500
A complete breakdown of the NYDFS cybersecurity rules and how small financial services firms can achieve full compliance.
Understanding NYDFS 23 NYCRR 500
The New York Department of Financial Services (NYDFS) Cybersecurity Regulation (23 NYCRR 500) is one of the most comprehensive and stringent state-level cybersecurity frameworks in the United States. Originally effective March 1, 2017, with significant amendments in 2023, this regulation establishes minimum cybersecurity standards for all financial services institutions licensed or regulated by NYDFS.
Who Must Comply?
Any entity operating under a license, registration, charter, certificate, permit, accreditation, or similar authorization under the Banking Law, Insurance Law, or Financial Services Law.
Core Objective
Protect consumer data and ensure the safety and soundness of New York's financial services industry through comprehensive cybersecurity programs.
Why These Rules Matter
- Regulatory Enforcement: NYDFS actively examines and enforces compliance, with significant penalties for violations
- Consumer Protection: Safeguarding sensitive financial and personal information is paramount
- Business Continuity: Proper cybersecurity reduces the risk of costly breaches and operational disruptions
- Competitive Advantage: Demonstrating strong cybersecurity builds trust with clients and partners
High-Level Compliance Expectations
Covered entities must establish and maintain a comprehensive cybersecurity program designed to protect the confidentiality, integrity, and availability of their information systems. This includes:
Written Policies
Designated CISO
Annual Certification
Detailed NYDFS Requirements
Click each section to view specific regulatory obligations and compliance expectations
Additional sections include: Cybersecurity Policy (500.03), CISO Requirements (500.04), Penetration Testing (500.05), Audit Trail (500.06), Access Controls (500.07), Application Security (500.08), Risk Assessment (500.09), Personnel Training (500.10), Third-Party Security (500.11), Multi-Factor Authentication (500.12), Data Retention (500.13), Monitoring & Encryption (500.14-500.16), 72-Hour Reporting (500.17), Exemptions (500.19), Annual Certification, Recordkeeping, and 2023 Amendments.
Who Must Comply?
NYDFS 23 NYCRR 500 applies to all entities licensed or regulated by the New York Department of Financial Services
Mortgage banks and mortgage brokers
Insurance companies and producers
Licensed lenders and consumer finance companies
Money transmitters and virtual currency businesses
Investment advisers and broker-dealers
Premium finance agencies
Sales finance companies
Budget planners and debt adjusters
Any other entity licensed or regulated by NYDFS
Note: If your organization is licensed or regulated by NYDFS in any capacity, you are subject to this regulation regardless of your size or the volume of business you conduct in New York.
How MortgageMoat Helps You Comply
We specialize in helping small financial services firms achieve and maintain NYDFS compliance
Comprehensive Risk Assessments
We conduct thorough risk assessments tailored to your business, identifying vulnerabilities and prioritizing remediation efforts to meet Section 500.09 requirements.
NYDFS-Compliant Policies & Procedures
Receive customized, written cybersecurity policies that address all requirements of Section 500.03, ready for board approval and implementation.
Managed Cybersecurity Services
Our team serves as your virtual CISO, providing ongoing monitoring, incident response, vulnerability management, and compliance oversight.
Employee Awareness Training
Engaging, NYDFS-focused training programs that satisfy Section 500.10 requirements and reduce your human risk factor.
Vendor Risk Management
We help you assess and manage third-party cybersecurity risks per Section 500.11, including due diligence and ongoing monitoring.
Annual Certification Support
We prepare all documentation and supporting evidence needed for your annual Section 500.17(b) certification, ensuring accuracy and completeness.
Penetration Testing & Vulnerability Assessments
Annual penetration testing and continuous vulnerability scanning to meet Section 500.05 requirements and strengthen your defenses.
Incident Response Planning & Support
Develop and test incident response plans that meet Section 500.16 requirements, with 24/7 support when incidents occur.
Ready to Achieve NYDFS Compliance?
Let MortgageMoat guide you through every requirement of 23 NYCRR 500 with expert support tailored to small financial firms.