Securing Trust: Best Practices for Keeping Clients’ Data Secure

• December 3, 2025

By Michelle Bender

Cybersecurity is essential for protecting sensitive financial information in a rapidly changing digital landscape. Strong security measures and client awareness are critical to maintaining trust and safeguarding assets.

As businesses manage client information in an increasingly digital world, they should consider new policies to enhance data protection and reduce the risk of incidents like data breaches, identity theft and unauthorized access to sensitive financial records.

One policy to consider is to stop emailing personal or sensitive information for life insurance and health care policies. Instead, have your clients use a secure portal for document storage or to provide information.

Another way to add an extra layer of identity verification is to assign each client a unique secure word. Clients must provide their word when requesting account changes. If they can’t recall it, offer memory phrases as hints. If they still can’t remember, they must visit the office in person to select a new security word and sign paperwork.

Regularly educate clients on recognizing and responding to common cybersecurity threats. A key recommendation is never to access financial sites over public Wi-Fi while traveling and instead use a secure hotspot. Stress the importance of strong, unique passwords, the use of multifactor authentication (MFA) and avoiding the use of physical notebooks for storing login details.

Scam emails are another frequent concern. Remind clients always to check the full email address, never send money based solely on an email and to call directly if something seems off. Emphasize that it is important to look through the email carefully to see if there are misspelled words or if the email address does not seem correct. These are major red flags that can indicate a scam.

While you don’t manage your clients’ bank accounts, you should notify them of any suspicious activity so they can take action with their bank directly.

In our line of work, we have a responsibility to guide both our teams and our clients through the evolving cybersecurity landscape. Awareness is the first line of defense. Have your team complete a cybersecurity certification program to strengthen internal processes and reshape how they communicate with clients about online safety. Many programs include system scans, software checks and advisor-focused learning modules.

It’s essential to work closely with a tech-savvy IT provider that keeps you informed with monthly updates on scams and new cyber threats. If they spot a widespread issue, they can alert you immediately so you can notify clients before problems arise.

Vigilance, education and continual improvement form the foundation of effective cybersecurity. Prioritizing these helps advisors confidently protect their clients and their practice from evolving digital threats.

Michelle Bender is president and senior advisor at Potomac Financial Consultants LLC and a registered representative of Kestra Advisory Services. Bender is a 14-year MDRT member with ten Top of the Table and eleven Court of the Table qualifications.