Press Release

Survey of Financial Services IT Executives Highlights Continued Need to Protect Consumer Data

Compliance, not perceived threats, driving increase in security budgets and use of encryption

REDWOOD CITY, Calif.—March 27, 2006— Ingrian® Networks, Inc., the leading provider of data privacy solutions, today announced results of a survey the company recently spearheaded of 112 IT executives in the financial services industry. The new survey, sponsored by Ingrian and conducted by InfoTech, the market intelligence and analysis unit of Access Intelligence, was designed to provide insight into security measures currently being undertaken by the financial services industry, attitudes towards the security of consumer information, and the drivers such as legislative mandates and the increasing awareness of security breaches behind current security projects.

The 112 survey respondents were comprised of directors, vice presidents and C-level executives of IT and/or security from the financial services industry. The largest segments of the respondents work in retail banking (37.7%) and commercial banking (32.1%), with the remaining respondents working in investment banking, securities/commodity trading, insurance and credit unions. When asked about the importance of securing data and the confidence in how well the data is secured using encryption technology, there was a significant split among respondents – with 53.8% agreeing or strongly agreeing that encrypting “Data at Rest” is a high priority for their organization and 38.5% disagreeing or strongly disagreeing that it is a high priority.

“The financial services industry is at a crossroads when it comes to security in general and enterprise encryption strategies in particular,” said Lane F. Cooper, director, InfoTech and author of the study. “While a tremendous amount of effort is being expended by the financial services sector to protect communications and information resources through increasingly hardened perimeter security measures, 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 Sector are NOT well prepared to protect this data at rest. There is a growing realization in the industry that this needs to be addressed. The research conducted by InfoTech strongly suggests that we can expect to see encryption play a much larger role in the security mix of financial services organizations by the end of the decade.”

Based on one-on-one phone interviews with the financial services executives, the survey results highlighted the following findings:

• Compliance is driving the move towards encrypting sensitive information with 87% of respondents agreeing or strongly agreeing with the statements “Regulatory/legislative compliance is elevating the requirement to encrypt sensitive information in my organization’s enterprise systems”.
• Sixty-seven percent (67%) of respondents indicated that compliance requirements were putting their organization under more pressure to encrypt data at rest.
• Less than one-third of respondents, only 31 percent, believe that their organizations are doing an adequate job of encrypting data at rest.
• Of the various compliance initiatives, the largest percentage (70.6%) of respondents were most affected by Sarbanes-Oxley while the Gramm-Leach-Bliley Act and the Patriot Act were a close second and third with 66.7% and 60.8%, respectively. California SB1386 and other state privacy laws registered at 49%, and FISMA, HIPAA and PCI received 43.1%, 41.2% and 31.4% respectively.

“Consumer security is extremely important to any financial services organization, but the path to security and the confidence in those security measures, is extremely varied,” said Karim Toubba, vice president of product management and corporate strategy for Ingrian Networks. “This survey has made it clear to us that while legislation is currently the driving force to secure consumer data, there is still education needed around what it means to ensure data privacy. There are specific steps that organizations can take to comply with new laws, so it is important for an organization to deploy a product like Ingian’s DataSecure Platform to become compliant with legislation.”

About DataSecure Platforms

Ingrian DataSecure Platforms provide an intelligent, cost-effective way to protect critical data from both internal and external threats. Featuring dedicated hardware appliances and patent-pending cryptography software, Ingrian’s solutions deliver capabilities for granular encryption, seamless integration, and centralized security management. With its solutions, Ingrian supports:

• Retailers, financial institutions, and payment processors in adhering to card issuer security policies like the Payment Card Industry (PCI) Data Security Standard.
• Organizations around the world seeking to comply with privacy legislation, such as California SB1386, the Europe Union Data Protection Directive, and many others.
• Financial institutions seeking to comply with Gramm-Leach-Bliley Act.
• Government agencies striving to adhere to the Federal Information Security Management Act.

About InfoTech: The Telecom Intelligence Group

InfoTech: The Telecom Intelligence Group is a global business-intelligence resource for decision-makers among technology developers, service providers, manufacturers, resellers/systems integrators and enterprises of all sizes. InfoTech, publishes quarterly tracking and analysis reports on business communications systems and applications as part of its InfoTrack for Enterprise Communications (IEC) program. For more information visit: www.telecomweb.com.

About Ingrian Networks

Ingrian Networks brings complete data privacy to the enterprise. With Ingrian DataSecure Platforms, organizations can protect critical data from both internal and external threats, and ensure compliance with legislative and policy mandates for security. DataSecure features a dedicated security appliance and specialized software that enables organizations to encrypt critical data in applications and databases. With its capabilities for granular encryption, seamless integration, and centralized security management, DataSecure enables organizations to guard against a range of security threats, with unparalleled ease and cost effectiveness. Ingrian is a privately held company backed by such investors as Globespan Capital Partners, HighBAR Ventures, Menlo Ventures, Partech International, and Prism Venture Partners. For more information, visit http://www.ingrian.com.

Ingrian Media Contact

Betty Liang

Ingrian Networks

bliang@ingrian.com

650.261.2488