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REDWOOD CITY, Calif. – Cost, complexity and technical difficulties are the biggest barriers to encrypting sensitive customer and member data, according to a new survey of senior IT managers at banks, credit unions and other financial institutions. The survey, just released by Ingrian Networks, was conducted by telephone with 112 IT executives in the financial services industry by InfoTech, the market intelligence and analysis unit of Access Intelligence. The question of encryption, and compliance with growing regulations to protect data, has been looming large in the wake of highly publicized security breaches of account information for millions of consumers at a variety of businesses. Ingrian Networks, a provider of data privacy solutions, commissioned the survey to gain insight into the drivers and attitudes on the subject among people whose jobs include oversight of customer and member data. The survey found that only about 40% of the respondents felt their organization was “making effective use of encryption technology across the enterprise to protect sensitive data at rest,” while 50% felt that was not happening in their shops. Meanwhile, more than 50% of the respondents cite impact on existing applications and the entire enterprise, as well as cost, as barriers to encrypting “data at rest,” the survey report says. “There are a number of perceptions in the marketplace right now – by businesses and consumers alike – about encryption and securing consumer information. This survey has made it clear to us that there are a number of reasons for both congratulations and concern,” says Karim Toubba, vice president of product management and corporate strategy for Ingrian Networks, a provider of enterprise data privacy solutions. An overwhelming majority of the respondents, 87%, agree that regulators and lawmakers were “elevating the requirement to encrypt sensitive information in my organization’s enterprise systems,” the survey found, but only 54% say such encryption is a high priority for their organizations. The mixed results still gave the survey company cause to predict increased attention and effort toward encrypting and otherwise securing consumer data, and predicted problems arising for those who don’t. “The financial services industry is at a crossroads when it comes to security in general and enterprise encryption strategies in particular,” says Lane Cooper, InfoTech director and the study’s author. He says “a tremendous amount of effort” continues to be made at the perimeter level” but the “fact remains that most organizations are likely to experience a significant security incident in the foreseeable future. “Encryption is the last line of defense should a major breach occur, and huge segments of the financial services industry are not well prepared to protect this data at rest.” That said, spending apparently is ongoing and increasing in the encryption space. Nearly 57% of the respondents say they expect their organization to invest more resources in 2006 than they did the year before in encrypting “data at rest.” -

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