3 Digital Identity Risk Management

The purpose of defining the online service is to understand its functionality and establish a common understanding of its context, which will inform subsequent steps of the DIRM process. The role of the online service is contextualized as part of the broader business environment and associated processes, resulting in a documented description of the scope of the online service, user groups and their expectations, data processed, impacted entities, and other pertinent details.

RPs SHALL develop a description of the online service that includes, at minimum:

It is imperative to consider unexpected and undesirable impacts, as well as the scale of impact, on different entities that result from an unauthorized user gaining access to the online service due to a failure of the digital identity system. For example, if an attacker obtained unauthorized access to an online service that controls a power plant, the actions taken by the bad actor could have devastating environmental impacts on the local populations that live near the facility and cause power outages for the localities served by the plant.

It is important to differentiate between user groups and impacted entities, as described in this document. The online service will allow access to a set of users who may be partitioned into a few user groups based on the kind of functionality that is offered to that user group. For example, an online income tax filing and review service may have the following user groups: (1) citizens who need to check the status of their personal tax returns, (2) tax preparers who file tax returns on behalf of their clients, and (3) system administrators who assign privileges to different groups of users or create new user groups as needed. Impacted entities include all those who could face negative consequences in the event of a digital identity system failure. This will likely include members of the user groups but may also include those who never directly use the system.

Accordingly, the scope of impact assessments SHALL include individuals who use the online application as well as the organization itself. Additionally, organizations SHALL identify other entities (e.g., mission partners, communities, and those identified in [SP800-30]) that need to be specifically included based on mission and business needs. At a minimum, organizations SHALL document all impacted entities (both internal and external to the organization) when conducting their impact assessments.

The output of this step is a documented description of the online service, including a list of the user groups and other entities that are impacted by the functionality provided by the online service. This information will serve as a basis and establish the context for effectively applying the impact assessments detailed in the following sections.

This step of the DIRM process addresses the first dimension of risk by identifying the risks to the online service that might be addressed by an identity system.

The purpose of the initial impact assessment is to identify the potential adverse impacts of failures in identity proofing, authentication, and federation that are specific to an online service, yielding an initial set of assurance levels. RPs SHOULD consider historical data and results from user focus groups when performing this step. The impact assessment SHALL include:

The level of impact for each user group identified in Sec. 3.1 SHALL be considered separately based on the transactions available to that user group. This gives organizations maximum flexibility in selecting and implementing assurance levels that are appropriate for each user group. While impacts to user groups, the organization, and other entities are primary considerations for impact assessments, organizations SHOULD also consider scale (e.g., number of persons impacted by transactions).

The output of this assessment is a defined impact level (i.e., Low, Moderate, or High) for each user group. This serves as the primary input to the initial assurance level selection.

The effective impact level (i.e., Low, Moderate, or High) serves as a primary input to the process of selecting the initial assurance level for each user group (see Sec. 3.3.1) to identify the corresponding set of baseline digital identity controls from the requirements and guidelines in the companion volumes [SP800-63A], [SP800-63B], and [SP800-63C]. The resulting initial assurance level for each user group applies to all three digital identity system functions (i.e., identity proofing, authentication, and federation).

The initial set of selected digital identity controls and processes will be assessed and tailored in Step 4 based on potential risks generated by the identity management system.

The second dimension of risk addressed by the DIRM process focuses on risks from the identity management system that represent the unintended negative consequences of the initial selection of xALs and related technical and process controls in Sec. 3.3.4.

Tailoring provides a process to modify an initially assessed assurance level and implement compensating or supplemental controls based on ongoing detailed risk assessments. It provides a pathway for flexibility and enables organizations to achieve risk management objectives that align with their specific context, users, and threat environments. This process focuses on assessing the risks posed by the identity system itself, specific environmental threats, and privacy and customer experience impacts. It does not prioritize any specific risk area or outcomes for organizations. Making decisions that balance different types of risks to meet organizational outcomes remains the responsibility of organizations.

While organizations are required to implement and document a tailoring process, this guideline does not require the initial assurance levels or control sets to be modified as a result. However, organizations are expected to complete the assessments in the tailoring section to fully account for the outcomes of their selected initial assurance levels.

Within the tailoring step, organizations SHALL focus on impacts to mission delivery due to the implementation of identity management controls, including the possibility of legitimate users who are unable to access desired online services or experience sufficient friction or frustration with the identity system (and technology selection) that they abandon attempts to access the online service.

As a part of the tailoring process, organizations SHALL review the Digital Identity Acceptance Statements and practice statements¹ from CSPs and IdPs that they use or intend to use. However, organizations SHALL also conduct their own analysis to ensure that the organization’s specific mission and the communities being served by the online service are given due consideration for tailoring purposes. As a result, the organization MAY require their chosen CSP to strengthen or provide optionality in the implementation of certain controls to address risks and unintended impacts to the organization’s mission and the communities served.

To promote interoperability and consistency, organizations SHOULD implement their assessed or tailored xALs consistent with the normative guidance in this document. However, these guidelines provide flexibility to allow organizations to tailor the initial xALs and related controls to meet specific mission needs, address unique risk appetites, and provide secure and accessible online services. In doing so, CSPs MAY offer and organizations MAY utilize tailored sets of controls that differ from the normative statements in this guideline.

Organizations SHALL establish and document their xAL tailoring process. At a minimum, this process:

The tailoring process promotes a structured means of balancing risks and impacts while protecting online services, systems, and data in a manner that enables mission success and supports security, customer experience, and privacy for individuals.

Continuous improvement is a critical tool for keeping pace with the threat and technology environment and identifying programmatic gaps that need to be addressed to balance risk management objectives. For instance, an organization may determine that a portion of the target population intended to be served by the online service does not have access to affordable high-speed internet services, which are needed to support remote identity proofing. The organization could bridge this gap by establishing a program that offers local, in-person proofing services within the community. This could involve providing appointments with proofing agents who can meet individuals at more accessible locations, such as their local community center, the nearest post office, a partner business facility, or even at the individual’s home.

To address the shifting environment in which they operate and more rapidly address service capability gaps, organizations SHALL implement a continuous evaluation and improvement program that leverages input from end users who have interacted with the identity management system as well as performance metrics for the online service. This program SHALL be documented, including the metrics that are collected, the sources of data required to enable performance evaluation, and the processes in place for taking timely actions based on the continuous improvement process. This program and its effectiveness SHOULD be assessed on a regular basis to ensure that outcomes are being achieved and that programs are addressing issues in a timely manner.

Additionally, organizations SHALL monitor the evolving threat landscape to stay informed of the latest threats and fraud tactics. Organizations SHALL regularly assess the effectiveness of current security measures and fraud detection capabilities against the latest threats and fraud tactics.

Designing services that support a wide range of populations requires processes to adjudicate issues and provide redress³ as warranted. Service failures, disputes, and other issues tend to arise as part of normal operations, and their impacts can vary broadly, from minor inconveniences to major disruptions or damage. Furthermore, the same issue experienced by one person or community as an inconvenience can have disproportionately damaging impacts on other individuals and communities.

To enable access to critical online services while deterring identity-related fraud and cybersecurity threats, it is essential for organizations to plan for potential issues and to design redress approaches that aim to be fair, transparent, easy for legitimate claimants to navigate, and resistant to exploitation attempts.

Understanding when and how harms might be occurring is a critical first step for organizations to take informed action. Continuous evaluation and improvement programs can play a key role in identifying instances and patterns of potential harm. Moreover, there may be business processes in place outside of those established to support identity management that can be leveraged as part of a comprehensive approach to issue adjudication and redress. Beyond these activities, additional practices can be implemented to ensure that users of identity management systems are able to voice their concerns and have a path to redress. Requirements for these practices include:

Organizations are encouraged to consider these and other emerging redress practices. Prior to adopting any new redress practice, including supporting technology, organizations SHOULD test the practice with users to avoid the introduction of unintended consequences, particularly those that may counteract or contradict the goals associated with redress. In addition, organizations SHALL assess the integrity and performance of their redress mechanisms and implement controls to prevent, detect, and remediate attempted identity fraud involving those mechanisms.

The close coordination of identity functions with teams that are responsible for cybersecurity, privacy, threat intelligence, fraud detection, and program integrity enables a more complete protection of business capabilities and constant improvement. For example, payment fraud data collected by program integrity teams could provide indicators of compromised subscriber accounts and potential weaknesses in identity proofing implementations. Similarly, threat intelligence teams may learn of new TTPs that could impact identity proofing, authentication, and federation processes. Organizations SHALL establish consistent mechanisms for the exchange of information between stakeholers that are responsible for critical internal security and fraud prevention. Organizations SHOULD do the same for external stakeholders and identity services that comprise their online services.

When organizations are supported by external identity providers (e.g., CSPs), the exchange of data related to security, fraud, and other RP functions may be complicated by regulations or policy. However, establishing the necessary mechanisms and guidelines to enable effective information sharing SHOULD be considered in contractual and legal mechanisms. All data collected, transmitted, or shared by the identity service provider SHALL be subject to a detailed privacy and legal assessment by either the entity generating the data (e.g., a CSP) or the related RP for whom the service is provided.

Coordination and integration with various organizational functional teams can help to achieve better outcomes for the identity functions. Ideally, such coordination is performed throughout the risk management process and operations life cycle. Companion volumes [SP800-63A], [SP800-63B], and [SP800-63C] provide specific fraud mitigation requirements related to each of the identity functions.

Identity solutions use artificial intelligence (AI) and machine learning (ML) in various ways, such as improving the performance of biometric matching systems, automating evidence or attribute validation, detecting fraud, and even assisting users (e.g., chatbots). While the potential applications of AI and ML are extensive, these technologies may also introduce new risks or produce unintended negative outcomes.

The following requirements apply to all uses of AI and ML in the identity system, regardless of how they are used: