The Hidden Human Risks That Won’t Show Up in Your Audit—Until It’s Too Late

Regulatory audits are an integral part of banking, designed to identify gaps in cybersecurity programs. For regional banks, where maintaining customer trust and community ties is part of the mission,  audits are more than just regulatory check-ins—they are opportunities to reaffirm the institution's commitment to safeguarding financial security.

However, even with their rigorous standards, audits can miss the dynamic, evolving human risks that lie beneath documented processes and technical controls. What if some of the most critical risks are hiding in plain sight, beyond the reach of compliance checklists?

For regional banks juggling regulatory demands with real-world threats, the hidden risks often lie where audits don’t look: in human behavior, cultural drift, and subtle operational vulnerabilities.

The Comfort Trap of Compliance

Passing an audit provides a sense of security, but it can create a dangerous illusion. Compliance frameworks focus on documented processes, technical controls, and policy adherence. However, even with multiple regulatory frameworks in place, we've seen from experience that many human factors directly related to cyber risks are not effectively captured within these compliance and governance structures.

Human behaviors, decision-making under pressure, and cultural nuances often operate in the shadows of formal controls, leaving critical vulnerabilities unchecked until an incident occurs. While these are critical, they often overlook the dynamic nature of human behavior:

• Behavioral Drift: Employees may start with strong security habits but gradually relax over time, especially without continuous reinforcement.

• Shadow Risk Culture: Official policies might exist, but unwritten rules and day-to-day workarounds can create hidden vulnerabilities. This challenge is amplified in branch or departmental offices and remote work environments, where consistent oversight is harder to maintain, making it even more difficult to bring practices back into compliance.

• Overconfidence in Training: Annual training might check the box, but alone, it rarely changes behaviors or addresses emerging threats like AI misuse or deepfake fraud.

Real-World Scenarios That Slip Through Audits

1. The Unintentional Insider Threat: A well-meaning employee uses unauthorized AI tools to boost productivity, unknowingly exposing sensitive data to third-party platforms.

2. The Silent Compromised Credential: A phishing simulation score looks great, but no one notices that an employee reused a compromised password from a past breach.

3. The Vendor Blind Spot: A third-party contractor with elevated access follows outdated security protocols, becoming the weak link in an otherwise strong chain.

4. The Privileged Access Pitfall: An IT administrator retains privileged access rights long after changing roles within the organization. No one audits these permissions regularly, leaving critical systems vulnerable to insider threats or credential theft.

5. The Deepfake Deception: A finance department employee receives a seemingly urgent video message from the CFO, instructing them to transfer funds to a new account. The message, convincing in both appearance and tone, is actually a sophisticated deepfake created by cybercriminals to exploit trust and authority.

None of these scenarios are likely to be flagged in a standard audit—until they trigger an incident.

Why Human Risks Are Hard to Measure (But Not Impossible)

Traditional audits rely on static evidence: policies, logs, training records. Human risks, however, are dynamic and contextual. They manifest in:

• Decision-making under stress (e.g., falling for urgent phishing scams)

• Workarounds that bypass controls (e.g., sharing credentials for convenience)

• Cultural attitudes toward security (e.g., “It’s IT’s problem, not mine”)

The key is shifting from static snapshots to continuous human risk monitoring—measuring not just what people know, but how they behave in real situations. This requires an approach that goes beyond annual check-the-box exercises to embrace continuous, contextual assessment. By digging into cultural elements and behavioral risks, organizations can pinpoint exactly where human risk is happening: Is it a mistake, misuse, or malicious intent? Is it due to a knowledge gap or incorrect use of resources? All these factors can be surfaced through ongoing measurement, providing clarity on not just the 'what' but the 'why' behind risky behaviors.

What You Can Do Now

1. Move Beyond Annual Training: Implement micro-learning and just-in-time interventions to reinforce secure behaviors continuously.

2. Baseline Human Risk: Conduct assessments that measure not just knowledge but behaviors, attitudes, and cultural alignment.

3. Connect the Dots: Integrate human risk data with technical controls to get a 360-degree view of vulnerabilities.

4. Make Security Personal: Tailor awareness programs to different roles and risks, focusing on real-world relevance rather than generic content.

The Bottom Line

Audits are necessary, but they’re not sufficient. The real risk lies in the gaps between compliance and culture, between policy and practice. Regional banks that recognize and address these hidden human risks will not only pass audits—they’ll build resilience that lasts long after the auditors leave.