Business VPNs in Highly Regulated Industries

Business VPN  Regulations

As more businesses migrate to the cloud, there’s a shift for highly regulated industries (like healthcare and finance) to require regulation and further legislation to help protect business data as well as the data of their clients.

Protecting this data requires specific security tools, and many organizations are utilizing Virtual Private Networks to help with data security. Many VPN services help provide online privacy and protect your online activity, but a VPN also allows businesses to have a secure internet connection from an external source.

This shift has been helped by the work-from-home movement with remote workers accessing their organization’s data from an external internet service provider. A business VPN provides secure access and prevents unauthorized access to this network, in addition to providing online security. A VPN is becoming a popular tool to help accomplish security and privacy, and meet the regulations that are required in these industries.

Quick Takeaways

  • Regulated Industries: The healthcare industry is heavily regulated, with stringent standards and frameworks such as HIPAA (Health Insurance Portability and Accountability Act) in the United States, governing the protection and privacy of patient information. Finance, as a regulated industry, is subject to various financial regulations and compliance standards worldwide, including General Data Protection Regulation (GDPR), aimed at ensuring financial transparency and accountability. Both healthcare and finance sectors are critical components of a nation’s infrastructure, and compliance with regulatory frameworks is essential to maintain the integrity, security, and ethical standards within these industries.
  • Virtual Private Network (VPN): A Virtual Private Network (VPN) is a secure and encrypted network connection established over the internet, allowing users to access private networks and share data remotely. By creating a virtual tunnel between the user’s device and the VPN server, VPNs enhance privacy and security by encrypting the data transmitted, preventing unauthorized access or monitoring. VPNs are commonly used to ensure a secure connection in public Wi-Fi settings, protect sensitive information, and enable users to access restricted content by masking their IP address. It’s critical to ensure your VPN is secure, so take extra care to focus on VPN security.
  • Remote Work: Remote work in healthcare involves leveraging telehealth technologies for virtual consultations, remote patient monitoring, and secure access to electronic health records, enhancing patient care flexibility. In the finance sector, remote work entails the use of secure virtual private networks (VPNs) for financial transactions, access to sensitive data, and collaboration among financial professionals, ensuring operational continuity while adhering to regulatory compliance. Both healthcare and finance industries have adapted to remote work by integrating advanced technologies to maintain productivity, security, and seamless service delivery.
  • Data Privacy: Data privacy refers to the protection and control of personal and sensitive information, ensuring that individuals have authority over how their data is collected, processed, and shared. It involves implementing measures to safeguard data against unauthorized access, use, or disclosure, with a focus on maintaining the confidentiality and integrity of the information. Compliance with data privacy principles and regulations is crucial in fostering trust between individuals and organizations by assuring that personal data is handled responsibly and ethically.

Why You Need a VPN

Most people think of a VPN as a tool to help hide your online activity, disguise internet traffic from a specific IP address, and increase online privacy. But, as the needs of organization’s have shifted, VPN’s have become more than tools to hide internet traffic on public Wi-Fi. 

The Confidentiality, Integrity, and Authenticity of Data

In regulated industries, such as finance, healthcare, and government, the secure transmission of sensitive data and remote access to critical systems are paramount. Virtual Private Networks (VPNs) play a crucial role in ensuring the confidentiality, integrity, and authenticity of data during transmission. By encrypting the communication channels between connected devices, VPN providers create a secure tunnel that shields information from a potential security risk and unauthorized access while also identifying potential risks. 

This is particularly important in sectors where compliance with stringent data protection regulations is mandatory.

The intersection of VPN use and regulatory compliance requirements is a key aspect of maintaining the integrity of sensitive information. Many regulatory frameworks, such as GDPR in Europe or HIPAA in the healthcare sector, emphasize the need for robust security measures to safeguard personal and confidential data. VPNs not only aid in achieving the technical requirements outlined in these regulations but also contribute to broader compliance efforts by enabling secure remote access by increasing the level of security required to access the network.

Compliance often involves strict controls on data access, storage, and transmission, and VPNs provide a reliable solution to meet these demands. As organizations navigate the complex landscape of regulatory requirements, implementing VPNs becomes a foundational element in their cybersecurity strategy to ensure both operational efficiency and adherence to legal standards.

Compliance Challenges with VPNs

Regulated industries are required by government agencies to have increased security to help protect consumer’s and client’s data in addition to the corporate network. A VPN connection helps provide a secure connection to the internal network so regulated industries can stay compliant and identify and prevent potential illegal activities.

Many of these organizations need to direct VPN traffic with the number of remote workers increasing. The changing digital landscape requires remote internet users to access the internal company network outside of physical locations of the office.

Common Regulatory Frameworks

Common regulatory frameworks such as the Health Insurance Portability and Accountability Act (HIPAA) and the General Data Protection Regulation (GDPR) significantly impact the deployment and use of Virtual Private Networks (VPNs) in various sectors. HIPAA, established in the United States, sets the standards for the protection of patients’ sensitive health information. VPNs play a crucial role in helping healthcare organizations comply with HIPAA requirements, especially when transmitting patient data between different entities or accessing electronic health records remotely.

The encryption provided by VPNs ensures the confidentiality of health information, mitigating the risk of unauthorized access and potential breaches.

International Policies

On the international front, GDPR, applicable in the European Union, imposes strict guidelines for the protection of personal data. VPNs become instrumental in GDPR compliance by securing the transfer of personal information across networks and borders. GDPR emphasizes the principles of data minimization, purpose limitation, and confidentiality, all of which align with the secure data transmission capabilities of VPNs.

However, organizations deploying VPNs to meet GDPR requirements need to be mindful of specific challenges, such as ensuring that the VPN service provider complies with GDPR standards and adequately addressing issues related to data residency and cross-border data transfers.

Additional Compliance Challenges

Despite the benefits that VPNs bring to regulated industries, there are specific compliance challenges associated with their use.

For instance, maintaining audit trails and access logs, a requirement under many regulatory frameworks, can be more complex in VPN environments, especially if not configured and monitored appropriately.

Additionally, organizations must carefully manage user access controls within the VPN to prevent unauthorized personnel from gaining access to sensitive data. VPNs should be regularly updated and patched to address vulnerabilities and ensure that they meet evolving compliance standards. Striking the right balance between usability and security poses an ongoing challenge, as overly restrictive VPN configurations may hinder productivity, while lax settings may expose organizations to regulatory non-compliance risks.

Addressing these challenges requires a comprehensive understanding of both the regulatory landscape and the intricacies of VPN technology.

VPN Features and Technologies for Compliance

In the regulated industries like healthcare and finance, regulatory compliance is of paramount importance, VPNs offer several features that help meet stringent requirements. One crucial aspect is data encryption, where VPNs employ strong encryption algorithms to secure financial transactions, customer information, and other sensitive data. VPNs play a crucial role in facilitating secure communication channels, ensuring that financial data remains confidential and uncompromised.

VPNs enable remote employees to securely access electronic health records (EHRs) from remote locations and facilitate the transmission of patient data among healthcare professionals and institutions. The confidentiality and integrity of patient information are maintained through VPN encryption protocols which add an additional layer of protection, reducing the risk of data breaches and ensuring compliance with HIPAA’s stringent privacy and security standards.

Failure to comply with these requirements can result in severe penalties and potential jail time for the companies and employees that do not keep this data secure.

Next-generation VPN technologies further enhance compliance and security measures in both finance and healthcare. Multi-factor authentication (MFA) is a crucial feature that adds an extra layer of identity verification, strengthening access controls and complying with regulatory requirements for secure user authentication. Additionally, advanced threat detection and prevention mechanisms integrated into next-gen VPNs help organizations stay ahead of evolving cybersecurity threats, aligning with the dynamic nature of regulatory landscapes.

Next-gen VPNs are also expected to provide granular access control and access through dedicated servers allowing organizations to define and enforce access policies based on user roles and responsibilities. This capability is especially beneficial in meeting industry-specific compliance requirements, such as limiting access to sensitive financial or healthcare data only to authorized personnel. Next-gen VPNs also often provide more comprehensive auditing and logging capabilities, aiding organizations in meeting compliance mandates that necessitate detailed records of user activities and network events.

Best Practices for VPN Deployment in Regulated Industries

Deploying Virtual Private Networks (VPNs) in regulated industries requires careful consideration of security, compliance, and operational factors. Here are some best practices for VPN deployment in such environments:

  • Understand Regulatory Requirements: Before deploying a VPN, organizations in regulated industries must thoroughly understand the specific regulatory requirements that apply to them, such as HIPAA, GDPR, or PCI DSS. Tailor the VPN deployment to align with these regulations, ensuring that data transmission and remote access practices comply with the mandated security and privacy standards.
  • Encryption and Data Protection: Implement strong encryption protocols to safeguard sensitive data during transmission. The use of robust encryption algorithms is crucial for maintaining the confidentiality and integrity of information. This practice is especially vital in industries like finance and healthcare, where protecting customer and patient data is paramount. Regularly update encryption standards to align with industry best practices and compliance standards.
  • Access Controls and Authentication: Establish granular access controls and robust authentication mechanisms within the VPN infrastructure. Role-based access should be enforced to limit user privileges based on job responsibilities. Multi-factor authentication adds an extra layer of security by requiring users to verify their identity through multiple means. This helps prevent unauthorized access, a critical aspect of compliance in regulated sectors.
  • Logging and Auditing: Implement comprehensive logging and auditing features to monitor VPN activities. Maintain detailed records of user logins, access attempts, and network events. This information not only assists in identifying potential security incidents but also supports regulatory compliance by providing a transparent account of who accessed what information and when. Regularly review and analyze these logs to ensure security and compliance integrity.
  • Regular Security Audits and Updates: Conduct regular security audits of the VPN infrastructure to identify vulnerabilities and address them promptly. Keep the VPN software, firmware, and configurations up to date to patch any known security vulnerabilities. Regularly test the VPN environment for potential weaknesses, and conduct penetration testing to simulate real-world attack scenarios. This proactive approach ensures that the VPN remains a secure and compliant component of the overall network architecture.

By adhering to these best practices, organizations in regulated industries can deploy VPNs that not only meet compliance requirements but also provide a robust and secure foundation for data transmission and remote access.

Create a Bulletproof Security Strategy with Perimeter81

As your organization looks to deploy a robust security strategy, utilizing a Virtual Private Network (VPN) is key to help protect your network, your organization’s data, and the data of your clients.

Perimeter81 is a partner with businesses working in regulated industries with the expertise to ensure that your organization is meeting these specific regulations and requirements to help prevent yourself from outside threats, in addition to being outside of legally mandated compliance.

Reach out to Perimeter81 today to see how we help organizations scale while maintaining these requirements!


How are VPNs regulated?
Companies must make sure they maintain all compliance requirements. A VPN allows employees to remotely and securely access corporate resources, but if organizations are outside of regulatory compliance, it can go against government regulations and put user privacy at risk.
Working with a trusted partner can help ensure that your VPN is set up properly and within compliance.

On the other hand, cloud interconnect offers dedicated, high-bandwidth links between on-premises data centers and the cloud, providing a more reliable and efficient connection for large-scale, mission-critical workloads.
How are VPNs used in companies?
Each organization is different but many utilize VPNs to allow remote access to employees while also providing additional security for the organization’s network
How can VPNs be beneficial for organizations?
It allows for employees to remotely access the network through a secure server which is a huge benefit for modern businesses.
What is the role of VPN in the financial sector?
VPNs allow businesses in the financial sector to keep financial transactions secure while accessing from outside of the organization’s network.
Why should you use a VPN?
VPNs help provide robust protection for organizations and allow for remote access while also protecting against potential security concerns.