Understanding the Risks of Shadow SaaS

Shadow AI Is Already Inside Your Business, and It’s a Ticking Time Bomb Employees aren’t waiting for IT approval. They are quietly using AI tools, often paying for them out of pocket, to speed up their work. This underground adoption of AI, known as Shadow AI, is spreading fast. And it is a massive risk. What’s Really Happening? • Employees are pasting confidential data into AI chatbots without realizing where it is stored. • Sales teams are using unvetted AI tools to draft contracts, risking compliance violations. • Junior developers are relying on AI-generated code that might be riddled with security flaws. The Consequences Could Be Devastating ⚠️ Leaked Data: What goes into an AI tool does not always stay private. Employees might be feeding proprietary information to models that retain and reuse it. ⚠️ Regulatory Nightmares: Unapproved AI use could mean violating GDPR, HIPAA, or internal compliance policies without leadership even knowing. ⚠️ AI Hallucinations in Critical Decisions: Without human oversight, businesses could act on false or misleading AI outputs. This Is Not About Banning AI, It Is About Controlling It Instead of playing whack-a-mole with unauthorized tools, companies need to own their AI strategy: ✔ Deploy Enterprise-Grade AI – Give employees secure, approved AI tools so they do not go rogue. ✔ Set Clear AI Policies – Define what is allowed, what is not, and train employees on responsible AI use. ✔ Keep Humans in the Loop – AI should assist, not replace human judgment in critical business decisions. Shadow AI is already inside your company. The question is, will you take control before it takes control of you? H/T Zara Zhang

Shadow SaaS accounts are a growing risk, amplified by AI SaaS agents operating with unverified identities. These agents integrate via APIs across corporate systems, increasing the attack surface for data leakage, unauthorized access, and token misuse. Without strong identity governance, they can create shadow accounts and mismanage sensitive data, leading to security vulnerabilities. 🙇♂️Imagine a world where corporate identities are built on a foundation of verified personal identities. This isn't just about streamlining onboarding; it's about fundamentally transforming how we manage security. I strongly believe that corporate identities of futures be derived from vetted, certified personal identities by amending attributes relevant to the corporate organization. This approach could help address shadow SaaS account usage by ensuring that every corporate SaaS account is tied to an authenticated individual within the organization while maintaining organizational control. 🟣How It Could Work: Use of Personal Identity for Corporate Enrolment • Employees and contractors use their verified personal identities (e.g., government ID, biometrics, PKI certificates) to register within the corporate identity system. • This identity is then amended with corporate-specific attributes (e.g., role, department, project affiliation). * Corporate Identity Federation & Attribute-Based Access Control (ABAC) • Corporate identity is generated dynamically based on organizational policies. • Attributes such as employment status, project assignments, and security clearances dictate access levels to SaaS applications. • When an employee leaves or changes roles, their corporate identity attributes update automatically, mitigating orphaned shadow SaaS accounts. * Tracking and Visibility of SaaS Usage • Since the corporate identity is derived from a certified identity, any shadow SaaS account creation can be linked back to an employee. • Logging and auditing can ensure that only corporate-sanctioned applications are used. * Integration with Cloud Access Security Brokers (CASB) and Identity Providers (IdPs) • A CASB or IdP (like Okta, Azure AD, or Keycloak) can enforce security policies using these identities. • Unauthorized SaaS usage can be flagged if an account is created outside approved corporate identity parameters. This method works best if all SaaS applications adopt the corporate identity model; otherwise, employees may still use personal emails for registration. While no global standard exists for deriving corporate identities from personal ones, frameworks like NIST PIV, FICAM, and ISO/IEC 27701 guide identity verification, credential management, and privacy controls. Initiatives like Kantara and IAM best practices further support governance, federation, and policy enforcement to mitigate shadow SaaS risks. #SaaS #Cybersecurity #IdentityManagement #IAM #AI #DataSecurity #ShadowIT #CASB #IdP #DigitalIdentity

𝗨𝗻𝗺𝗮𝗻𝗮𝗴𝗲𝗱 𝗦𝗮𝗮𝗦 & 𝗔𝗜 𝗮𝗽𝗽𝘀 𝗮𝗻𝗱 𝘀𝗼𝗳𝘁𝘄𝗮𝗿𝗲 𝗮𝗿𝗲 𝘁𝗿𝗲𝗺𝗲𝗻𝗱𝗼𝘂𝘀 𝗮𝗻𝗱 𝗿𝗶𝘀𝗶𝗻𝗴 𝗰𝘆𝗯𝗲𝗿𝘀𝗲𝗰𝘂𝗿𝗶𝘁𝘆 𝘁𝗵𝗿𝗲𝗮𝘁𝘀 𝗳𝗼𝗿 𝗦𝗠𝗕 𝗼𝗿𝗴𝗮𝗻𝗶𝘇𝗮𝘁𝗶𝗼𝗻𝘀, 𝘀𝘁𝗮𝗿𝘁𝘂𝗽𝘀, 𝗮𝗻𝗱 𝗹𝗮𝗿𝗴𝗲𝗿 𝗶𝗻𝗰𝘂𝗺𝗯𝗲𝗻𝘁 𝗳𝗶𝗿𝗺𝘀 (𝗮𝘀 𝗹𝗼𝗻𝗴 𝗮𝘀 𝘁𝗵𝗲𝘆 𝗿𝗲𝗺𝗮𝗶𝗻 𝘂𝗻𝗺𝗮𝗻𝗮𝗴𝗲𝗱). A staggering 90% of SaaS applications and 91% of AI tools in companies are unmanaged. The Grip Security survey paints a stark picture: the number of SaaS applications deployed in a company has surged by 40% in the last two years. This rapid growth highlights the scale of the problem and the gravity of the inadequacy of traditional security solutions in addressing 'SaaS risk creep.' At the same time, the number of SaaS applications per employee has constantly increased, resulting in an 85% increase in the number of accounts per user. However, 73% of provided users do not use their SaaS application licenses. There is a similar issue with AI; #ChatGPT was detected in 96% of assessed firms, and usage has surged 24x since its inception. The research expresses concern about the emergence of shadow SaaS and AI systems, such as personal cloud storage accounts or unsanctioned AI chatbots utilized without #IT visibility or control. 42% of AI applications support SAML (Security Assertion Markup Language, which facilitates security across many apps), yet 80% are not managed or federated using the #SAML protocol. The sheer number of unmanaged #SaaS apps and #AI technologies discovered in enterprises demonstrates the significant gap between perceived and actual #cybersecurity. Gartner expects that by 2027, 75% of employees will utilize technologies outside of IT's control. Therefore, enterprises must reconsider their SaaS security strategy to address the growing risk of unmanaged applications. A comprehensive identity-based approach, which involves strict user authentication and access control, is required to ensure SaaS security and risk management in all vertical and horizontal functions. Link to the full report: https://buff.ly/4fgNA0P

Your cyber strategy is only as good as the vendor you forgot about. We used to think of shadow IT as that one rogue team spinning up an AWS server on a corporate card. Today, it’s way more subtle and more dangerous. It's the SaaS tool someone trialed last year and never offboarded. It’s the AI plugin someone installed without reading the terms. It’s the third-party vendor who still has access even though the project ended. Third-party risk isn’t a checklist. It’s an iceberg. What you can see is just the beginning. You can patch every system, run every tabletop, tighten every endpoint but the real risk might be sitting outside your environment, quietly connected through OAuth or API keys that no one is monitoring. DSPM, SaaS governance, API security, and vendor access management are no longer “nice to have.” They’re foundational. What’s the most surprising third-party risk you’ve discovered recently? #Cybersecurity #ThirdPartyRisk #ShadowIT #VendorRiskManagement #APISecurity #DSPM #SaaSSecurity #RiskManagement, Grip Security, Lior Yaari, Upwind Security, Amiram Shachar, Cyera, Yotam Segev

𝐃𝐨𝐧’𝐭 𝐫𝐨𝐥𝐥 𝐭𝐡𝐞 𝐝𝐢𝐜𝐞 𝐰𝐢𝐭𝐡 𝐒𝐡𝐚𝐝𝐨𝐰 𝐒𝐚𝐚𝐒. 🎲 𝐄𝐯𝐞𝐫𝐲 𝐭𝐢𝐦𝐞 𝐬𝐨𝐦𝐞𝐨𝐧𝐞 𝐚𝐭 𝐲𝐨𝐮𝐫 𝐜𝐨𝐦𝐩𝐚𝐧𝐲 𝐬𝐢𝐠𝐧𝐬 𝐮𝐩 𝐟𝐨𝐫 𝐚 𝐒𝐚𝐚𝐒 𝐚𝐩𝐩 𝐮𝐬𝐢𝐧𝐠 𝐣𝐮𝐬𝐭 𝐚𝐧 𝐞𝐦𝐚𝐢𝐥 𝐚𝐧𝐝 𝐩𝐚𝐬𝐬𝐰𝐨𝐫𝐝, 𝐡𝐞𝐫𝐞’𝐬 𝐰𝐡𝐚𝐭 𝐲𝐨𝐮’𝐫𝐞 𝐫𝐞𝐚𝐥𝐥𝐲 𝐠𝐚𝐦𝐛𝐥𝐢𝐧𝐠 𝐨𝐧: 🎲 Will they use it responsibly?  🎲 Will they reuse their work password (again)?  🎲 Will they abandon it in 14 days and leave it hanging? Here’s what we do know:  ↳ 44% of SaaS vendors offer free trials — no credit card needed. It's a great growth hack for SaaS suppliers, but it’s also how unsanctioned SaaS ends up inside your organization.     ↳ Half of users log in less than once a month. (Budget waste, anyone?) ↳ Those accounts linger. Even if the user ghosts it, that SaaS app still has a live connection to your network and data. ↳ Most security teams don’t even know these apps exist until something bad happens. SaaS is moving fast. Shadow SaaS is moving faster. Your security has to move fastest. That’s what we built Grip Security for.