Cybersecurity: A Global Legal Perspective For Hedge Funds

[InfoSec News <alerts () infosecnews org>]

http://risktech-forum.com/news/cybersecurity-a-global-legal-perspective-for-hedge-funds

Hedgeweek
11 June 2015

The House of Representatives passed a new cybersecurity bill – the 
Protecting Cyber Networks Act (PCNA) – to allow file sharing between 
government intelligence agencies and private companies and raise the 
overall awareness of hacking.

This is just the latest chapter in what is fast becoming a key narrative 
within the US, where cybersecurity legislation is being rolled out to 
address the growing sophistication of cyber attacks.

Hedge funds are now becoming a more pronounced target and to that end, 
lawyers are requiring to get on top of the issues to advise their clients 
accordingly. Ed McNicholas is a partner at Sidney Austin LLP in Washington 
DC. He confirms that he has just finished a treatise for the Practicing 
Law Institute, the aim of which is to provide a legal guide on 
cybersecurity. It is due to be published in June.

“The law here is developing rapidly and one of the biggest things that 
hedge funds need to do is to ensure communication between their lawyers 
and their IT staff on this issue. The lawyers have, for a long time, 
considered it to be an IT issue but they need to get up to speed on this,” 
says McNicholas.

McNicholas sees three big tasks facing lawyers. The first relates to 
managing the information assets of a hedge fund. These are highly 
specialised vehicles and as such an intellectual step needs to be taken by 
law firms in realising that this is not an issue that pertains solely to 
personal data. Hedge funds have significant intellectual property – 
trading algorithms, investor details, proprietary research etc. In 
relation to cybersecurity, it is important to identify those assets and 
understand where and with whom the manager shares those assets.

[...]

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