As SaaS providers race to integrate AI into their products to stay competitive and relevant, a new challenge is emerging in the AI world: shadow AI.
Shadow AI refers to the misuse of AI tools or co-pilots in organizations. For example, developers use ChatGPT to help write code, sales reps download AI-powered meeting transcription tools, and customer support reps use Agentic AI to automate tasks. , these do not need to go through the proper channels. When these tools are used without the knowledge of IT and security teams, they often lack adequate security controls, putting corporate data at risk.
Shadow AI detection challenges
Shadow AI tools are even more difficult to detect than traditional shadow IT because they are often incorporated into authorized business applications via AI assistants, co-pilots, and agents. While traditional shadow apps can be identified by network monitoring techniques that scan for unauthorized connections based on IP addresses and domain names, these AI assistants share IP addresses or domains with authorized applications and can go unnoticed. You can fly without falling.
Additionally, some employees utilize standalone AI tools associated with their personal accounts, such as personal ChatGPT instances, to assist with work-related tasks. Although these AI apps are not connected to corporate infrastructure, there is still a risk that employees could enter sensitive data into the apps, increasing the potential for data breaches.
Shadow AI security risks
Like other shadow apps, shadow AI apps expand their attack surface through unsupervised integrations and APIs. They often have weak configurations such as excessive permissions, duplicate passwords, and no multi-factor identification (MFA), increasing the risk of exploitation and lateral movement within the network.
However, shadow AI tools are even more dangerous than traditional shadow apps due to their ability to capture and share information. According to one study, 15% of employees contribute company data to AI tools. Because GenAI models learn from every interaction, there is a risk of exposing sensitive information to unauthorized users or spreading misinformation.
How Reco discovers shadow AI in SaaS
Reco, a SaaS security solution, uses AI-based graph technology to detect and catalog shadow AI. Here’s how Reco works:
Active Directory Integration: Reco starts by integrating with your organization’s Active Directory, such as Microsoft Azure AD or Okta, to collect a list of approved and known applications and AI tools. Email metadata analysis: Reco analyzes email metadata from platforms like Gmail and Outlook to detect communications with unauthorized tools. Filter out internal apps and marketing emails, and focus on usage metrics like account verifications and download requests. GenAI Module Matching: Using a unique fine-tuned model based on interactions and NLP, Reco consolidates and cleans lists and matches IDs with compatible apps and AI tools. Next, create a list of all SaaS apps and AI tools in use, who is using them, and what authentication mechanisms are used. Shadow Application Detection: By comparing this list with the list of known applications and AI tools, Reco creates a list of unauthorized applications and shadow AI tools.
What Reco says about Shadow AI tools
Once Reco generates a list of shadow AI tools and apps, Reco can answer questions such as:
Which SaaS apps are currently being used across your organization? Which of these apps are powered by AI assistants and co-pilots?
Reco takes inventory of all applications running in your environment that are associated with business email. Create a list of who is using what, how they are authenticating, and create activity logs to understand their behavior. Doing so can alert you to suspicious activity such as excessive downloads, external file sharing, and permission changes. It also provides vendor risk scores so security teams can prioritize high-risk apps.
What app-to-app connections exist?
SaaS applications do not operate as islands. To effectively manage risk, you need to understand how your applications interact with other applications. Reco displays integrations between all apps detected in your environment. For example, you can see whether your AI tools are connected to business-critical applications like Gmail or Snowflake, and what permissions each AI application has.
What identities are using each AI tool? What permissions do they have and how do they authenticate?
One of the main challenges with SaaS security is the lack of centralization. This means identity management is distributed across multiple apps. Reco unifies the identity of all your SaaS applications so you can manage them from a single console. You can take a closer look at what privileges each ID has, how it authenticates, and whether it has administrative privileges. Who doesn’t have MFA enabled? Who has too many privileges? You can create roles and enforce policies across multiple apps.
What actions did each identity perform across SaaS and AI applications, and when did this occur?
Reco’s AI-based knowledge graph technology associates and maps all discovered SaaS applications, including sanctioned and shadow applications, to identities, privilege levels, and actions from both humans and machines. The knowledge graph then looks for changes in these vectors over time. If the graph shows dramatic changes, Reco will alert you to an anomaly. For example, if user engagement decreases, Reco can predict that the employee is planning to leave the organization.
Find out which AI applications are accessing your sensitive data and who is using them. Next, implement governance and access management policies through the Reco platform.
What Reco can’t do when it comes to Shadow AI security
Shadow AI security features have certain limitations because Reco operates in an agentless, read-only capacity. Here’s what you can’t do with Reco:
Data Entry Prevention: Reco cannot prevent users from entering sensitive data into unauthorized AI tools or applications. Blocking Shadow AI tools: Reco does not directly block or disable Shadow AI tools or integrations, as they do not interfere with app functionality. Restrict User Behavior: Reco cannot enforce policies or prevent users from accessing unauthorized tools. All it can do is detect activity and alert you. Permission changes: Reco has only read-only access to data and no write access to SaaS applications, so it cannot change user permissions or revoke access to shadow AI tools. Stopping API Integrations: Reco cannot prevent third-party shadow AI tools from connecting through the API, but it can identify and alert you to these connections.
After all, Reco is a visualization and discovery tool. Although it cannot take action on its own, it can provide security teams with the knowledge they need to take the right action at the right time to reduce risk.
How Reco continuously protects SaaS applications and AI tools
Reco discovers, inventories and ranks all shadow applications and AI tools, then provides continuous security throughout the SaaS lifecycle. Reco enables:
Posture management and compliance: Reco identifies misconfigurations that can put your data at risk, such as over-permitted users, exposed files, stale accounts, and weak authentication mechanisms. The How to Fix feature explains how to clean up the risk. Continuously monitor configuration changes that could lead to data leaks through SaaS Security Posture Management (SSPM). Identity and Access Governance: Reco unifies identity across SaaS applications and enables centralized management of permissions and roles. By analyzing the privilege levels and behaviors of users within your SaaS ecosystem, Reco provides visibility into critical exposure gaps that can lead to a breach. Threat detection and response: Reco provides real-time alerts for anomalous activity that may indicate malicious intent, such as improbable trips, unusual downloads, suspicious permission changes, and repeated failed login attempts. . Integrates with SIEM or SOAR, allowing organizations to efficiently remediate SaaS risks within their existing workflows.
If you want to learn more about Reco, check out the pre-recorded demo here. Or visit reco.ai to schedule a live demo.
