Which statement is FALSE regarding the risk factors an organization may include when defining TPRM compliance requirements?

The statement that compliance requirements should be identical for all third parties is false. A core principle of a mature Third-Party Risk Management (TPRM) program is the risk-based approach. This means that the level of due diligence, contractual requirements, and ongoing monitoring must be proportional to the level of risk each third party presents. Applying a one-size-fits-all approach is inefficient, costly, and fails to focus resources on the highest-risk relationships, potentially leaving the organization exposed to significant threats.

A. Industry influence: This is true. Industries like finance (e.g., FFIEC) and healthcare (e.g., HIPAA) have specific regulations that dictate TPRM compliance requirements.

C. Geographic location: This is true. A third party's location determines which data privacy laws (e.g., GDPR, CCPA) and other regulations apply.

D. Data sensitivity: This is true. The type of data a third party accesses (e.g., PII, intellectual property) is a primary factor in defining security and compliance requirements.

1. Shared Assessments. (2023). Certified Third Party Risk Professional (CTPRP) Body of Knowledge. The Program Governance section emphasizes the necessity of a risk-based approach and tiering of third parties to apply appropriate levels of oversight.

2. Office of the Comptroller of the Currency. (2013). OCC Bulletin 2013-29: Third-Party Relationships: Risk Management Guidance. Page 8 states that the level of due diligence and oversight should be commensurate with the level of risk.