Federal Funding, Private‑Equity Risks, and Zero‑Trust Training: America’s Race to Outsmart Cyber Attackers

Cybersecurity Concerns Escalate Across Sectors: Water Infrastructure and Private Equity Face Heightened Threats

Washington D.C.– February 13,2026 – A surge in Cybersecurity incidents this week highlights the growing vulnerability of critical infrastructure and the financial sector across the United States. From bolstering defenses at local water authorities to bracing for escalating risks in private equity, organizations are confronting an increasingly refined threat landscape. The need for robust cybersecurity measures has never been more urgent.

Federal Funding Bolsters Water Security in New York

Monroe County, New york’s Water Authority is set to receive $1.1 million in federal funding for crucial infrastructure upgrades.This investment, championed by Senators Chuck Schumer and Kirsten Gillibrand, and Representative Joe Morelle, is intended to protect the region’s drinking water supply from potential cyberattacks. The funding, recently approved through a federal appropriations bill, will be used to enhance data storage security, modernize critical infrastructure components, establish redundant backup systems, and deploy advanced threat detection software.

senator Schumer emphasized the importance of ensuring residents have continued access to clean water, while Representative Morelle underscored the federal government’s role in supporting local communities. The allocation of thes funds signifies a growing recognition that Cybersecurity is not merely an Data Technology issue—it is a basic matter of public health and safety. According to the Environmental Protection Agency, water and wastewater systems are increasingly targeted by malicious actors.

Private Equity Firms Grapple with Rising Cyber Risk

Simultaneously, the private equity industry faces a growing reckoning with cybersecurity risks. A new report released by Kroll, a leading risk advisory firm, warns that cyber incidents are now considered a “material transaction risk” for Private Equity firms. The report, based on a survey of 325 executives, revealed that the average financial impact of a accomplished cyberattack reached $2.1 million – a figure that Kroll’s global head of cyber and data resilience, Dave Burg, notes often represents onyl the initial costs.

the report details a 53% probability of losses exceeding $500,000 per attack and a 13% chance of losses surpassing $5 million. A staggering 94% of respondents reported experiencing some financial ramifications due to Cybersecurity concerns. These repercussions included diminished valuations, increased compliance expenses, and unexpected remediation costs.

Portfolio Companies as Prime Targets

Kroll’s analysis showed that during the portfolio hold period – when Private Equity firms actively manage their investments – firms faced a particularly high risk of disruption. Eighty percent of firms experienced a cyberattack related to a portfolio company, with roughly a third resulting in outright business disruption and downtime. Further, 44% reported unexpected remediation costs and almost 30% faced compliance-related litigation.

Attackers are increasingly synchronizing their attacks with periods of integration and business transformation, leveraging tools like generative Artificial Intelligence to amplify their impact. Experts predict a continuing trend of increasingly sophisticated attacks targeting these vulnerable phases.

The Cybersecurity Readiness Gap

The Kroll report revealed a significant discrepancy in cybersecurity preparedness between large and mid-market Private Equity firms. Larger firms—those managing over $25 billion in assets—demonstrated a greater commitment to formal Cybersecurity mandates,standardized due diligence,and dedicated risk management platforms. For example, 55% of large firms had governance mandates in place compared to only 12% of smaller firms.

Cybersecurity Practice	Large Firms (> $25B AUM)	Mid-Market Firms
Formal Cybersecurity Mandates	55%	12%
Standardized Due diligence	81%	29%
Dedicated Cyber Risk Leader	50%+	15%

Eric Hasty, Managing Director of Cyber and Data Resilience at Kroll, cautioned that Cybersecurity incidents pose a threat to Private Equity portfolios of all sizes. He advocated for a streamlined set of Cybersecurity controls, dedicated platforms, standardized due diligence, and clear accountability to effectively protect investments.

Focus on Zero Trust and Hands-On Training

In response to the evolving threat landscape, organizations are increasingly turning to strategies like Zero Trust architecture. ThreatLocker, a global Cybersecurity provider, is hosting Zero Trust World (ZTW) 2026 in Orlando, Florida, from March 4-6. The event will feature prominent figures like Adam Savage, Jason Silva, Linus Sebastian, and renowned hacker Jakoby, offering practical training and real-world experience in implementing Zero Trust strategies.

The event’s program includes hands-on labs covering topics from dark web exploration to AI-powered malware generation and Active Directory hacking. Participants can also test their skills in a live hacking competition and pursue a Cyber Hero certification.

As Cybersecurity threats continue to evolve in both complexity and frequency, organizations across all sectors must prioritize proactive protection measures. From federal investments in public infrastructure to industry-wide reforms and hands-on education, the race to stay ahead of attackers is intensifying.What steps is your association taking to prepare for the next generation of cyber threats, and how are you balancing innovation with security?

How are federal cybersecurity funds and private equity risks influencing the implementation of Zero Trust training in critical infrastructure sectors?

Federal Funding, Private‑Equity Risks, and Zero‑Trust Training: America’s Race to Outsmart Cyber Attackers

The escalating threat landscape demands a multi-faceted approach to cybersecurity. America is currently engaged in a critical race against increasingly refined cyber attackers, and the strategy hinges on a complex interplay of federal investment, navigating the risks associated with private equity involvement in critical infrastructure, and a fundamental shift towards Zero Trust architecture through thorough training.

The Surge in Federal Cybersecurity Funding

Recent years have witnessed a notable increase in federal funding allocated to bolster cybersecurity defenses. The bipartisan Infrastructure Law and subsequent initiatives have earmarked billions for state and local governments, critical infrastructure sectors, and cybersecurity workforce development.

* State and Local Cybersecurity Grants: These grants are designed to help smaller entities implement basic cybersecurity hygiene, including vulnerability scanning, multi-factor authentication, and incident response planning.

* critical Infrastructure Protection: funding is flowing into sectors like energy, water, and transportation to enhance their resilience against cyberattacks. This includes upgrades to operational technology (OT) security and the implementation of advanced threat detection systems.

* Cybersecurity Workforce Development: Addressing the critical skills gap is a priority. Funding supports scholarships, training programs, and apprenticeships to cultivate a larger pool of qualified cybersecurity professionals.

* CISA’s Role: The Cybersecurity and Infrastructure Security Agency (CISA) plays a pivotal role in distributing these funds and providing guidance to stakeholders. Their “shields Up” initiative, launched in response to the Russia-Ukraine conflict, exemplifies proactive threat awareness and mitigation efforts.

Though, simply throwing money at the problem isn’t enough. Effective allocation and strategic implementation are crucial.

Private Equity and Cybersecurity: A Double-Edged Sword

The increasing involvement of private equity firms in acquiring and operating critical infrastructure companies presents a unique set of cybersecurity challenges. while private equity can bring capital and expertise, it also introduces potential risks.

* Short-Term Focus: Private equity firms often prioritize short-term financial gains, perhaps leading to underinvestment in long-term cybersecurity improvements. Cost-cutting measures might compromise security protocols.

* Debt Burden: Heavily leveraged acquisitions can strain financial resources, leaving less available for essential cybersecurity upgrades.

* Lack of Cybersecurity Expertise: not all private equity firms possess the necessary in-house cybersecurity expertise to adequately assess and manage risks within their portfolio companies.

* Supply Chain Vulnerabilities: acquisitions can introduce new vulnerabilities through interconnected supply chains, expanding the attack surface.

Mitigation Strategies: Increased regulatory scrutiny,mandatory cybersecurity due diligence during acquisitions,and requirements for ongoing security investments are essential to mitigate these risks. The SEC’s proposed cybersecurity disclosure rules are a step in the right direction,aiming to increase clarity and accountability.

Zero trust: The new Security Paradigm

Traditional perimeter-based security models are proving inadequate against modern threats. The Zero Trust approach, based on the principle of “never trust, always verify,” is gaining widespread adoption.

* Core Principles:

1. Assume Breach: Operate under the assumption that attackers are already present within the network.
2. Verify Explicitly: continuously authenticate and authorize every user and device before granting access to resources.
3. Least Priviledge Access: Grant users only the minimum level of access necessary to perform their job functions.
4. Microsegmentation: Divide the network into smaller, isolated segments to limit the blast radius of a potential breach.

* Key Technologies:

* Multi-Factor Authentication (MFA): A foundational element of Zero Trust, requiring multiple forms of verification.

* identity and Access Management (IAM): robust IAM systems are crucial for managing user identities and access privileges.

* Network Segmentation: Isolating critical assets and limiting lateral movement.

* Endpoint Detection and Response (EDR): Monitoring and responding to threats on individual devices.

* Security Information and Event Management (SIEM): Centralized logging and analysis of security events.

The Critical Role of Zero-trust Training

Implementing Zero Trust isn’t just about technology; it requires a fundamental shift in organizational culture and a well-trained workforce.

* Employee Awareness Training: Educating employees about phishing attacks, social engineering tactics, and safe computing practices is paramount.

* Role-Based Training: Tailoring training to specific job functions ensures that employees understand their responsibilities within the Zero Trust framework.

* Technical Training: Cybersecurity professionals need specialized training on Zero trust technologies and implementation best practices. Certifications like those offered by NIST and SANS Institute are valuable.

* Simulated Phishing Exercises: Regularly testing employees with simulated phishing attacks helps identify vulnerabilities and reinforce training.

* Incident Response Training: Preparing employees to respond effectively to security incidents is crucial for minimizing damage.

Real-World Example: Colonial Pipeline Attack (2021)

The Colonial Pipeline ransomware attack highlighted the vulnerabilities of critical infrastructure and the importance of robust cybersecurity measures. While the attack wasn’t directly related to a lack of Zero Trust implementation at the time, it served as a wake-up call, accelerating the adoption of Zero Trust principles across the energy sector. the incident underscored the need for enhanced OT security, improved incident response planning, and increased collaboration between government and industry.

Benefits of a Proactive Cybersecurity