Can Your Security Survive This One Test?

The Nightmare That Crippled LoanDepot—And Could Cripple Your Business Next 

Imagine waking up to find your entire business paralyzed. Employees locked out. Customers furious. Regulators knocking on your door, demanding answers.

But that’s only the beginning.

Over the next few months, you’re drowning in legal battles, hemorrhaging millions, and scrambling to restore trust in your organization. That’s exactly what happened to LoanDepot, one of the largest mortgage providers in the U.S. 

In early 2024, a ransomware attack crippled LoanDepot’s operations. Customers were unable to access accounts or make payments, and over 16 million individuals had their personal data exposed. A company once seen as a pillar of financial security became a cautionary tale overnight. The financial impact was catastrophic. LoanDepot was forced to settle a $27 million lawsuit, incurred over $41 million in breach-related expenses and later reported a staggering $65.9 million net loss during the second quarter. 

LoanDepot’s executives undoubtedly had security measures in place. Firewalls, endpoint protection, employee training—none of it stopped the attack. Hackers don’t care about check-the-box security. They exploit the gaps: unpatched vulnerabilities, misconfigured cloud settings, weak vendor security, or overlooked employee credentials. Attackers only need one foothold to bring a company to its knees. This is why even well-resourced organizations can collapse under the weight of a breach, and for smaller companies, the financial burden is often fatal. 

The question isn’t whether you have security in place—it’s whether it’s been tested by someone who thinks like an attacker. That’s why leading businesses don’t wait to be blindsided. They use third-party penetration testing to find the gaps before criminals do. 

Your Security Isn’t as Strong as You Think—And Hackers Know It 

Would you bet your organization on your security? Hackers hope so. 

Penetration testing, or "pen testing," simulates a real-world attack on your business. It reveals your biggest vulnerabilities before criminals can exploit them. While your internal teams may be skilled, they also suffer from familiarity bias—missing critical weaknesses simply because they see them every day. 

That’s where third-party testers come in.  

Third parties think like hackers, act like hackers, and find what your team doesn’t. These experts use real-world attack techniques to simulate the tactics cybercriminals actually employ against businesses like yours. They probe for weaknesses in network infrastructure, applications, employee access controls, and even vendor connections—mirroring the ways hackers gain footholds. By doing so, they expose vulnerabilities in a controlled environment, giving executives clear insights into what could happen in a real attack. The results aren’t just technical—they’re business-critical. Leaders get a tangible look at what’s at risk, from operational downtime to financial loss and regulatory fallout, so they can make informed decisions before an actual breach occurs.  

If you’re relying on internal audits alone, you’re leaving a massive blind spot. And cybercriminals thrive on blind spots. Think about it: would you let your accounting team audit their own financial reports without an external review? Probably not, because you need an independent perspective to catch errors, inconsistencies, or fraudulent activity. The same logic applies to cybersecurity. 

Internal teams, no matter how skilled, become accustomed to their own environments and methodologies. They may overlook risks simply because they are too familiar with the systems or because existing security measures create a false sense of confidence. 

Third-party testers bring a fresh, unbiased perspective. They use penetration testing techniques to simulate an actual breach. These simulated attacks help executives see, in a tangible way, how a breach could unfold and what the real impact could be. The insights gained aren’t just about fixing technical gaps; they highlight operational, financial, and reputational risks that leadership must address. When you rely solely on internal assessments, you aren’t just missing technical flaws—you’re gambling with the security of your entire business. 

The Hidden Cost of Insecurity—And How to Avoid It 

Beyond identifying vulnerabilities, penetration testing is a financial safeguard. Without it, the cost of a breach isn’t just about data recovery—it’s about lost revenue, lawsuits, and executive reputations. 

1. Cyber Insurance Payouts Depend on It 

No penetration testing? No payout. Insurers increasingly demand proof that businesses are proactively preventing breaches. 44% of cyber insurance claims are denied, which further highlights the need for third-party penetration tests. Without proper penetration testing documentation, your organization could be left to cover damages—costs that average $4.88 million per breach. 

2. Legal Defense Against Negligence Claims 

After a breach, businesses aren’t just hit with recovery costs—they’re hit with lawsuits. If you can’t prove you took reasonable steps to protect sensitive data, your company could face legal penalties or regulatory fines. 

Penetration testing provides hard evidence that you identified risks and took action, demonstrating due diligence in cybersecurity. 

3. Protecting Business Continuity 

A cyberattack grinds operations to a halt. Supply chains freeze. Employees are locked out. Customers lose trust. A single vulnerability in one vendor or internal system can trigger a catastrophic shutdown. 

Penetration testing prevents business disruption by identifying hidden risks before they take down operations. 

Cybersecurity Is a Business Issue, Not Just an IT Issue 

Executives often assume security is just an IT problem. But in today’s environment, it’s a boardroom priority. Cyberattacks shatter customer confidence, invite lawsuits, and expose leadership to public scrutiny. The best organizations stay ahead of the hackers. The question is: Will yours? 

Ask yourself: 

• Do your employees and leadership feel confident that your security measures will hold up under a real attack? 

• Can you demonstrate to your customers that their data is protected, fostering trust and long-term loyalty? 

• If a breach were to occur today, would your team know exactly how to respond, with a clear history of testing and remediation efforts to guide recovery? 

If you’re unsure about any of these, it’s time to take action. A breach isn’t just an IT headache but a business catastrophe. The cost isn’t only measured in dollars, but in lost trust, legal battles, and operational disruption. Ignoring these risks today only increases the likelihood of facing them tomorrow. 

Penetration testing goes beyond cybersecurity compliance. It’s about fortifying your business against evolving cyber threats, ensuring resilience, and proactively addressing vulnerabilities before attackers can exploit them. It’s about proving to your employees, customers, and stakeholders that security is a core business strategy. Executives who take security seriously don’t leave security to chance. They validate, test, and reinforce their defenses before an attacker does it for them. If you haven’t scheduled a third-party penetration test this year, now is the time. Because the next big breach could have your name on it.  

Ready to Put Your Security to the Test? 

Engaging a third-party provider offers an unbiased, in-depth assessment of vulnerabilities that internal teams may overlook, helping organizations not only meet regulatory requirements but also fortify their overall security posture. It minimizes liability, strengthens customer trust, and creates a framework for continuous improvement.  

The reality is clear: in today’s threat landscape, relying solely on internal assessments is a risk you can’t afford. Make independent penetration testing a fundamental pillar of your cybersecurity strategy before an attacker exploits the gaps you didn’t see.