Principals often ask us how exposed their family's data really is as more of the office's work moves online. Preserving wealth across generations now means protecting the information behind it as well as the assets. This article explains why cybersecurity has climbed the list of family office risks, how technology choices affect that exposure and how we approach client privacy, so your office can review its own safeguards and ask better questions of its providers.
We used AI tools to help gather research and speed up the first draft. That left more of our time for checking each figure against its original report and adding what we see in client conversations. A Masttro editor reviewed every claim, and members of our team read the article before it was published.
Key Takeaways
Multi-generational wealth preservation has become far more challenging in recent years. Among many industry pressure points today we can include growing competition, COVID 19, talent wars, and increasingly demanding investors. And, of course, cybersecurity threats.
Secure Your Legacy With Technology
Not surprisingly, technology can help to overcome these operational challenges. But technology adoption among family offices has been inconsistent, to say the least. While many offices are highly modernized, using advanced software systems to reduce costs and improve compliance, others opt still for more analog approaches. This is true despite the extra labor and time such efforts require.
This sort of aversion to technological change may be a function of family preference, office culture, or both. Whatever the cause, the result is unfortunate. Our experience at Masttro over the past decade has revealed a persistent truth: family offices that employ wealth-management platforms wisely see meaningful improvements in performance, efficiency, client approval, employee satisfaction, and more. Numerous factors contribute to these happy outcomes, not least data quality.
The Importance of Cybersecurity
But as family offices plan for a future in which digital attacks are expected to rise, security concerns must be top of mind. Already, financial firms of all sizes devote significant resources to bolstering their cyber defenses. And well they should, given global hackers’ increasingly creative schemes. (Increasingly costly, too: By some estimates, for every dollar a financial institution loses directly to fraud, it eventually loses nearly two more in related costs.)
That’s the scary news.
The comforting news is that wealth management platforms —when properly structured—can effectively de-risk many of the security gaps inherent in non-technological processes. But technological defense must go far beyond firewalls and anti-spoofing software to include military-grade encryption, top-level server security, and more.
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Our Dedication to Client Privacy
We posit this with some authority. Masttro’s private data centers are Tier IV certified, so these issues are top of mind for us. Beyond the multi-layered cryptographic security module that guarantees the privacy and integrity of all the data we handle, we are always seeking to close any and all potential doors to cybercrime, whether they are situated in technology or personnel realms. Or both: Our employees are blind to most client data captured in our platform.
At a time when new threats arise almost as quickly (if not more so) as existing ones are batted away, the family office that fails to think cybersecurity first is courting disaster. But for those that grasp the depth and breadth of the threats, there’s a technology-first approach that can provide well-earned peace of mind.
Want to learn how Masttro can provide you the best tech setup for your family office practice? Schedule time with one of our wealth tech experts.
“The Secure Communication Portal is very useful. It helps me during our monthly client meetings by providing a comprehensive view of each client’s consolidated portfolio. What used to take me days of work can now be done simply by verifying that the information matches the bank statements.”
“Masttro has helped us significantly improve the mapping and visibility of our corporate structure.”
“Masttro allows us to answer all the different questions from the owner’s perspective. What assets do I have? Where do I have them? Who knows about this information and who is in charge of it?”
