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Control 2.9: Defender for Cloud Apps — Copilot Session Controls — Portal Walkthrough

Step-by-step portal configuration for deploying Microsoft Defender for Cloud Apps session controls to monitor and govern Copilot interactions.

Prerequisites

  • Microsoft Defender for Cloud Apps license (included in M365 E5)
  • Security Administrator or Cloud App Security Administrator role
  • Conditional Access integration configured
  • Understanding of session control capabilities

Steps

Step 1: Enable Conditional Access App Control

Portal: Microsoft Defender for Cloud Apps Path: Defender > Settings > Conditional Access App Control > Connected Apps

Enable Conditional Access App Control for Microsoft 365 applications. This allows Defender for Cloud Apps to proxy Copilot-related sessions and apply real-time controls.

Verify Microsoft 365 appears in the connected apps list with "Enabled" status.

Step 2: Create Session Policy for Copilot Monitoring

Portal: Microsoft Defender for Cloud Apps Path: Defender > Policies > Policy Management > Create Policy > Session Policy

Create a session policy targeting Copilot interactions: - Policy name: "FSI Copilot Session Monitoring" - Session control type: Monitor all activities - Filters: App equals Microsoft 365; Activity type includes file operations and content interactions - Actions: Log and alert on sensitive content activities

Step 3: Configure Content Inspection for Copilot Sessions

Portal: Microsoft Defender for Cloud Apps Path: Defender > Policies > [Session Policy] > Content Inspection

Enable content inspection to detect sensitive data in Copilot sessions: - Enable DLP content inspection - Select sensitive information types relevant to FSI (SSN, account numbers) - Configure actions: Block download, apply watermark, or alert on detection

Step 4: Set Up Real-Time Alerts

Portal: Microsoft Defender for Cloud Apps Path: Defender > Policies > Alert Policies

Configure alerts for Copilot-related security events: - Unusual volume of Copilot interactions from a single user - Copilot access from risky locations or devices - Sensitive content detected in Copilot sessions - Policy violation attempts

Step 5: Configure Activity Logging

Portal: Microsoft Defender portal Path: Defender portal > Cloud Apps > Investigate > Activity Log

Verify that Copilot-related activities appear in the activity log. Configure log retention and export settings for compliance documentation. Activity logs provide the evidence trail for regulatory examinations.

Step 6: Review Generative AI App Catalog

Portal: Microsoft Defender portal Path: Defender portal > Cloud Apps > Cloud app catalog

  1. Navigate to the Cloud app catalog and select the Generative AI category filter to display the 1,000+ generative AI apps cataloged by Microsoft
  2. Review apps that appear in your organization's discovered traffic (shown with a "Discovered" indicator)
  3. Assess risk scores for any generative AI apps employees are using — high-risk apps may represent Shadow AI usage that exposes customer or financial data
  4. For high-risk apps: create an access policy to block the app or mark it as "Unsanctioned" to automatically generate a block script for deployment to your web proxy or firewall
  5. For sanctioned apps (including Microsoft 365 Copilot): mark as "Sanctioned" to exclude from Shadow AI alerts

Recommended governance workflow: - Monthly: Review newly discovered generative AI apps and assess risk scores - Quarterly: Update the sanctioned/unsanctioned app list and review block policies

Step 7: Configure Agent Threat Detection

Portal: Microsoft Defender portal (security.microsoft.com) Path: Defender portal > Settings > Endpoints > Detection rules OR Incidents & alerts

  1. Verify that agent-related detection rules are active for your Copilot agent deployments (Copilot Studio agents, SharePoint agents)
  2. Navigate to Incidents & alerts and filter for agent-related incidents to confirm detection is operational
  3. Configure custom detection rules for agent anomalies specific to your organization:
  4. Alerts when an agent accesses data outside its configured knowledge source scope
  5. Alerts when agent interaction volume significantly exceeds baseline
  6. Integrate agent threat alerts into your SIEM or Microsoft Sentinel workspace for correlation with user activity

FSI Recommendations

Tier Recommendation
Baseline Enable session monitoring for Copilot interactions; configure basic alerting; enable agent monitoring alerts in Defender XDR
Recommended Content inspection with DLP integration; real-time alerts for sensitive data; review generative AI app catalog monthly for Shadow AI governance; configure custom agent anomaly detection rules
Regulated Full session control with content inspection, blocking capabilities, and comprehensive activity logging; integration with SIEM for correlation; agent threat detection integrated into SOC playbooks with mandatory investigation SLAs; quarterly Shadow AI governance review with sanctioned/unsanctioned app list

Next Steps