10 Password Policy Best Practices for SOC 2 Compliance

Bad passwords lead to data breaches. Here's what you need to know:

Core Password Requirements	Standard
Minimum Length	12 characters
Password Changes	Every 90 days
Failed Login Attempts	3 before lockout
MFA	Required for all users
Password History	Last 6 passwords blocked

Here are the 10 critical practices you must implement:

1. Set strong password rules (12+ chars, mixed characters)
2. Enable Multi-Factor Authentication (MFA)
3. Use password management tools
4. Set account lockout rules
5. Track password history
6. Set up access levels
7. Check passwords automatically
8. Create password reset steps
9. Manage user sessions
10. Track password rule compliance

Why this matters: 80% of hacking-related breaches happen because of weak or stolen passwords. The average breach costs $3.86 million.

Quick facts:

• A 12-character password takes 200+ years to crack
• MFA blocks 99.9% of account hacks
• Users reuse passwords 13 times on average
• 81% of breaches start with compromised passwords

Tool Type	Purpose	Must-Have Features
Password Manager	Secure storage	AES 256-bit encryption, MFA
Access Control	User permissions	Role-based controls, logs
Monitoring	Security checks	Breach alerts, compliance reports
Session Manager	Login control	Timeouts, forced logouts

This guide shows exactly how to implement these practices to meet SOC 2 requirements and protect your systems.

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SOC 2 Password Rules: The Basics

SOC 2 password rules come from the AICPA's Trust Services Criteria (TSC). Here's what you need to know:

TSC Section	Focus Area	Key Requirements
CC6.1	Access Security	- Password length: 12+ characters - Mix of upper/lowercase, numbers, symbols - Regular password changes
CC6.2	User Management	- User registration process - Access removal for inactive users - Password history tracking
CC6.3	Access Control	- Role-based access limits - Account lockout rules - Failed login attempt limits

Let's break down the main password requirements:

Password Structure

• At least 12 characters long
• Mix uppercase and lowercase letters
• Include numbers and special characters
• Skip common dictionary words

Time Limits and History

• New password every 90 days
• Can't use your last 6 passwords
• Account locks after 3 failed tries

Managing Access

• Define clear user roles
• Cut off access when people leave
• Keep logs of password changes

Here's why these rules matter: Verizon's 2020 report shows that 80% of data breaches start with weak passwords. And Microsoft's data tells us that 99% of account hacks target users who don't follow proper password rules.

Metric	Value
Min Password Length	12 characters
Password Change Frequency	Every 90 days
Password History	Last 6 passwords
Failed Login Attempts	3 before lockout
Password Recovery Time	200+ years (with proper complexity)

SOC 2 doesn't hand you a strict password rulebook. Instead, it points you toward security best practices. Your job? Pick the right mix of these rules for your company's needs while keeping your data locked down tight.

Password Rules for SOC 2

Here's what you need to know about SOC 2 password requirements:

Requirement	Minimum Standard	Best Practice
Length	8 characters	12-15 characters
Maximum Length	64 characters	64 characters
Character Types	ASCII characters	ASCII + Unicode (including spaces and emojis)
Failed Attempts	3 tries before lockout	3 tries before lockout
Password Age	90 days	90 days
History Check	Last 6 passwords	Last 6 passwords

Here's the thing about passwords: LENGTH BEATS COMPLEXITY.

NIST now says to focus on length first. Why? A 12-character password takes about 200 years to crack - even if someone's making 1 trillion guesses per second.

And here's something that might surprise you: You don't need to force users to mix uppercase, lowercase, and special characters anymore. Instead:

• Let them use spaces
• Allow emojis and Unicode
• Set an 8-12 character minimum
• Support password managers

The numbers don't lie: Verizon found that 80% of hacking-related breaches start with weak passwords.

Want some password examples that actually work?

• "Teal-cashback-please-today"
• "correct horse battery staple"
• "P@$w0rd" (but longer is better)

Bottom line: These password rules aren't just for show. They're your first line of defense. Get them right, and you'll stop most attacks before they even start.

2. Use Multi-Factor Authentication

MFA stops 99.9% of account hacks, according to Microsoft. That's why it's your strongest defense after passwords.

Here's what MFA looks like in action:

Factor Type	Examples	How It Works
Something you know	Password, PIN	User enters information
Something you have	Phone, USB key	User confirms possession
Something you are	Fingerprint, Face ID	User provides biometric data
Location-based	IP address, GPS	System checks user location

For SOC 2, you need two factors minimum. Most teams go with:

• A password
• A phone app (like Google Authenticator)
• Sometimes biometrics for extra-sensitive stuff

Want to know what it costs? Here's the breakdown:

Tool	Free Tier	Paid Starting Price
Cisco Duo	Up to 10 users	$3/user/month
Auth0	Up to 7,000 users	$35/month (500 users)
LastPass	No	$4/user/month
ManageEngine	Up to 10 users	Custom pricing

Here's how to get started:

• Choose your MFA tool based on budget
• Start with admin accounts
• Create simple user guides
• Set up backup options
• Monitor failed attempts

Here's the bottom line: SOC 2 requires MFA. Your auditor will check for it. And with Duo Security processing over 1 billion MFA checks each month, it's clear this isn't just a trend - it's the new normal for business security.

Quick tip: Start simple with password + authenticator app. You can always add more layers later for sensitive data.

3. Use Password Management Tools

A password manager helps you meet SOC 2 requirements. Here's what top tools offer in 2024:

Tool	Starting Price	Key Features	Best For
Keeper	$2/user/month	Zero-trust setup, SOC compliance	Large enterprises
1Password	$7.99/user/month	MFA, admin controls	Mid-size teams
Dashlane	$8/user/month	Dark web checks, cross-platform	Remote teams
Bitwarden	$6/user/month	Open-source code, strong encryption	Budget-conscious
Zoho Vault	$7.20/user/month	Role controls, secure sharing	IT teams

Want to pick the right password manager? Look for these SOC 2 features:

• AES 256-bit encryption
• LDAP/directory sync
• Access logs
• Role controls

Then lock down these settings:

• No password copying
• Block TOTP seed exports
• Company email domain links
• Disable browser password saves

"The entity implements logical access security software, infrastructure, and architectures over protected information assets to protect them from security events to meet the entity's objectives."

Here's the thing: Microsoft found that people reuse the same password 13 times across different apps. That's a HUGE security risk. A password manager fixes this by creating different passwords for each service.

"1Password will alert you if company email addresses and associated passwords have been compromised by any vendor data breaches."

Ready to get started? Here's what to do:

1. Pick a tool that matches your company size and budget
2. Start with your exec team and IT admins
3. Create user groups and sharing rules
4. Test your policies
5. Roll out to everyone else

That's it. No fancy stuff - just solid password security that works.

4. Set Account Lockout Rules

Here's how to set up account lockouts that stop brute-force attacks in 2024:

Setting	Standard Value	High Security	Notes
Failed Attempts	5-6	3	Before lockout
Lockout Duration	30-60 mins	Admin unlock only	Auto vs manual reset
Reset Counter	15-30 mins	N/A	Time to clear failed attempts
Session Timeout	15 mins	10 mins	Auto-logout after inactivity

Let's break down the key lockout settings for SOC 2:

1. Failed Login Threshold

Pick 3-6 failed attempts. Here's why: More attempts = security risk. Fewer attempts = too many support tickets.

2. Lockout Duration

Go with 30-60 minutes. Skip the admin-only unlock unless you've got round-the-clock IT support.

3. Counter Reset

Set it under 30 minutes (but lower than your lockout time). This helps users who make honest mistakes but wait before trying again.

Want a smarter approach? Try this stepped lockout system:

Failure Stage	Action	Duration
First 3 attempts	Warning only	None
Next 3 attempts	Soft lock	5 minutes
Beyond 6 attempts	Hard lock	30 minutes

Make your lockouts better:

• Display failed attempt counts at login
• Keep logs of every lockout
• Set up IP-based lockout alerts
• Add MFA to cut down on lockouts

Quick note: PCI DSS wants max 6 attempts and 30-minute lockouts. SOC 2 doesn't give exact numbers but needs clear policies.

For Active Directory users: Set these up in Group Policy at Computer Configuration\Windows Settings\Security Settings\Account Policies\Account Lockout Policy.

5. Track Password History

Here's how to stop users from reusing old passwords:

Setting	Standard	High Security	Notes
Previous Passwords	10	24	Number of old passwords blocked
Minimum Age	1 day	3 days	Time before allowing changes
Maximum Age	365 days	180 days	Time before required change
History Duration	6 months	12 months	How long to store old passwords

Users LOVE to reuse passwords. But here's the thing: letting them do that puts your organization at risk.

That's why you need these 4 basic rules:

1. Block at least 10 previous passwords
2. Make users wait 1 day between changes
3. Compare new passwords with breach lists
4. Keep password history for 6+ months minimum

"Password reuse is an important concern in any organization, which is why it's important to track previously used passwords to make it impossible for users to use the same password over and over again."

Users try these sneaky password tricks:

Trick	Example	How to Stop It
Number Changes	Password1, Password2	Pattern matching
Character Swaps	P@ssword, P@$$word	Similar character detection
Minor Edits	MyPass123!, MyPass123@	Edit distance checks
Quick Changes	Multiple changes in one day	Minimum age policy

Setting Up in Active Directory:

Go to Group Policy and find:

• Computer Configuration > Windows Settings > Security Settings > Password Policy
• Set "Enforce Password History" to 10+
• Turn on "Minimum Password Age" (1+ days)

What Actually Works:

Don't make users change passwords more than once per year (that's what NIST says). Instead:

• Only force resets when there's a breach
• Log every password change
• Check passwords against breach lists daily

Here's the thing: When users have to change passwords too often, they pick weak ones. Focus on strong initial passwords and watch for breaches instead.

6. Set Up Access Levels

Here's how to set up access control that works (and keeps your SOC 2 auditors happy):

Access Level	Who Gets It	What They Can Do
Basic User	Regular employees	Change own password, use assigned apps
Department Admin	Team leads	Manage team passwords, approve resets
System Admin	IT staff	Configure password policies, manage all users
Security Admin	Security team	Monitor logs, handle breaches

Here's What You NEED to Do:

• Only give access people need for their work
• Cut off access within 24 hours after someone leaves
• Update access when jobs change
• Look at access lists every 3 months

Action	When	What to Do
New Hire	Day 1	Get manager approval, document access
Role Change	Within 48 hours	Remove old access, add new permissions
Employee Exit	Within 24 hours	Disable all accounts, log final access
Access Review	Every 90 days	Document current permissions, remove unused

What Goes Wrong Without Good Access Control?

Two recent examples show what NOT to do:

• South Georgia Medical Center had a data leak (November 2021) because they were slow to remove access
• Delaware's Elliot Greenleaf law firm lost client data (January 2021) when four lawyers kept access they shouldn't have had

How to Set This Up:

1. Pick Role-Based Access Control (RBAC)

It's simpler than other options and gets the job done for most teams.

2. Build Your System

• Write down what each role can do
• Create steps for approvals
• Set up ways to track access
• Add automatic removal

3. Log Everything

What to Log	Why It Matters
Access Changes	Shows who did what and when
Failed Logins	Helps spot break-in attempts
Usage Patterns	Finds dead accounts
Admin Actions	Tracks big system changes

Quick Tip: Use a ticket system for access requests. It creates the paper trail your SOC 2 auditors want to see.

Bottom line? Good access control stops most password problems before they start.

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7. Check Passwords Automatically

Here's a fact that'll make you think: 81% of hacking-related breaches come from weak or stolen passwords. And each breach? It costs $3.86 million on average.

Let's fix that with automatic password screening that fits SOC 2:

Password Check Type	What to Look For	Why It Matters
Known Breaches	Passwords exposed in data leaks	1.5% of all logins are compromised
Common Patterns	Dictionary words, simple sequences	Most common attack vector
Previous Breaches	Passwords from your company's past incidents	Prevents repeat vulnerabilities
Shared Credentials	Same password across multiple accounts	Stops cascade failures

Want to see this in action? Chrome's password checker runs 14 million checks every week. The result? A 37% drop in compromised credentials.

"We've all done it - rushing to create a login with our pet's name as the password. But these quick fixes open the door to security problems."

Here's how to set up your checks:

Step	Action	System Response
New Password Creation	Screen against breach database	Block known compromised passwords
Password Updates	Check against policy rules	Warn users before saving
Regular Scans	Monitor existing passwords	Alert admins to newly exposed credentials
Failed Attempts	Log and analyze patterns	Flag potential breach attempts

Your SOC 2 Checklist:

• Stop passwords that fail checks
• Get user confirmation for warning overrides
• Keep logs of all password checks
• Monitor override decisions
• Send alerts about weak password patterns

Tools That Work:

• Rapid7 InsightIDR for user behavior tracking
• Enzoic for real-time breach updates
• Chrome Password Manager for basic safety checks

Quick Setup:

• Connect to your directory service
• Turn on Single Sign-On
• Document override rules
• Set up alert workflows

Here's the bottom line: If you're in finance, healthcare, or the public sector, you're at the highest risk - these industries make up 50% of password-related breaches. Don't skip automatic checks. They're your first line of defense against expensive breaches.

8. Create Password Reset Steps

Here's a fact: Password resets drain company resources. But a good Self-Service Password Reset (SSPR) system can boost user adoption from 20-40% to 85-95%.

Your password reset system needs these core parts:

Component	Requirements	System Response
Current Password	Must enter before changes	Stops unwanted changes
Password History	Checks last 12 passwords	Stops password reuse
Expiration Period	365 days max	Alerts 14 days before
Verification Methods	Multiple options	SMS, email, phone
Session Management	After reset	Ends all active sessions

Here's how verification works:

Method	How It Works	Success Rate
Mobile Phone	SMS or call	Best uptake
Office Phone	Voice check	Works for office staff
Backup Email	Sends link	High success
Security Questions	Knowledge check	Basic but works

Take Microsoft's Entra ID as an example. Their cloud SSPR updates on-premises AD instantly - no delays, no sync issues.

Protection Limits:

Action	Limit	Why
IP Address Tries	5 per hour	Blocks attacks
Account Tries	3 per 15 min	Stops mass attempts
Token Use	Once only	No token reuse

For SOC 2, you need to:

• Set clear reset steps
• Use multiple checks
• Track reset tries
• Log successes
• Watch for fails

Make It Work:

• Quick reset emails
• Clear steps
• Brand it
• Big reset buttons
• Clean old sessions

Here's the deal: Passwords expire after 365 days. Users get a 14-day heads-up. After that? No login until they reset.

"SSPR success comes down to rollout planning and user prep. Pick your verification methods and get your users ready."

Watch These Numbers:

Metric	Goal	If You Miss
Reset Success	95%	Check user input
Reset Speed	< 5 min	Make it simpler
Help Desk Load	-50%	Better self-help
User Uptake	> 85%	Talk to users

Bottom line: Keep it simple AND secure. That's how you get more users on board and fewer help desk tickets.

9. Manage User Sessions

Here's how to handle sessions for SOC 2:

Application Risk	Idle Timeout	Max Session Length
High-value apps	2-5 minutes	4 hours
Standard apps	15-30 minutes	8 hours
Office apps	30 minutes	8 hours

Take Microsoft 365's web apps as an example: Their admins can set timeouts between 5 and 1,440 minutes across their platform.

Core Session Controls:

Control	Purpose	Impact
Idle Timeout	Kicks out inactive users	Stops unwanted access
Force Logout	Ends sessions after time limit	Cuts attack time
Session Reset	Updates ID after privilege shifts	Stops session hijacking
Cookie Setup	Uses temporary cookies only	Adds protection

Must-Track Session Events:

Event	What To Do	System Action
Login	Make new session ID	Start fresh session
Privilege Change	Update session token	Reset security
Password Change	Stop other sessions	Start clean
No Activity	Log out automatically	Clean up

SOC 2 needs two timeout types:

1. Idle timeout: Logs out inactive users
2. Absolute timeout: Ends sessions after fixed time

Your logout system needs:

• Easy-to-find logout button
• Server session cleanup
• Browser cookie removal
• Multi-device session ending

Watch These Session Metrics:

Metric	Look For	Next Steps
New Sessions	Sudden jumps	Check for attacks
Active Sessions	System load	Add resources
Login Fails	Attack attempts	Block IPs
Session Length	Usage trends	Fix timeout settings

Bottom line: Use short timeouts for sensitive data, longer ones for basic work. This keeps SOC 2 happy and users productive.

10. Track Password Rule Compliance

Let's break down how to monitor password rules for SOC 2:

Monitoring Area	What to Check	Action Needed
Failed Attempts	Number of wrong passwords	Lock account after threshold
Password Changes	Frequency and timing	Flag unusual patterns
Policy Violations	Non-compliant passwords	Force password updates
Reset Requests	Volume and sources	Check for suspicious activity

Here's what matters for SOC 2 password standards:

Metric	Target	Why It Matters
Password Age	< 90 days	Meets SOC 2 requirements
Complexity Score	8+ characters	Prevents weak passwords
Reuse Rate	0%	Stops password recycling
MFA Usage	100%	Required for compliance

Here's a scary fact: Verizon found that 80% of hacking-related breaches come from weak passwords. And the average person uses the same password 13 times across different apps. That's a BIG security problem.

Your monitoring toolkit should include:

Tool Type	Function	Output
Password Auditor	Scans existing passwords	Compliance status
Activity Logger	Tracks password changes	Audit trails
Alert System	Flags suspicious behavior	Real-time warnings
Compliance Scanner	Checks policy alignment	Status reports

Specops Password Auditor makes it simple with these status codes:

Color	Status	Action
Red	Non-compliant	Fix immediately
Yellow	Partly compliant	Review and update
Green	Fully compliant	Monitor regularly

Here's what you need to do:

• Run compliance scans every week
• Look at failed logins each day
• Check password reset patterns monthly
• Update your tracking tools every quarter
• Keep records for SOC 2 audits

Sprinto's system watches your password settings and tells you when something's wrong. It helps you catch and fix problems FAST.

Pro tip: Don't let service desk staff reset passwords directly in Active Directory. It's a security risk you don't need.

Bottom line: Watch BOTH your automated and manual password processes. SOC 2 auditors will check everything.

How to Set Up These Rules

Here's exactly how to set up your password and access rules:

Step	Action	Tool/Setting
1. Password Policy	Set minimum 12 characters	Active Directory
2. MFA Setup	Enable 2FA for all users	Google Authenticator
3. Access Control	Configure RBAC	Sprinto
4. Password Manager	Deploy enterprise solution	TeamPassword
5. Monitoring	Set up tracking systems	Specops Password Auditor

Your password settings should look like this:

Requirement	Setting	Note
Length	12+ characters	Industry standard
Complexity	Letters + Numbers + Symbols	Must include all three
Expiration	90 days	SOC 2 requirement
History	Last 6 passwords	Prevent reuse
Lockout	3 failed attempts	Security measure

Here's what to do in TeamPassword:

1. Build Your Password Structure

Set up these vaults:

• System credentials
• Application access
• Customer data
• Admin accounts

2. Set Up Access Levels

Role	Access Level	Permissions
Admin	Full	All systems
Manager	Limited	Team systems
User	Basic	Assigned apps
Contractor	Temporary	Time-limited

3. Connect Your Systems

Link your LDAP to:

• Add/remove users fast
• Track who's active
• Control access instantly

4. Watch Everything

Monitor	Frequency	Action
Failed Logins	Daily	Lock accounts
Password Age	Weekly	Force updates
Access Attempts	Real-time	Alert admins
Policy Violations	Daily	Fix issues

"We recommend organizations employ tools like vulnerability scanners, web application firewalls and penetration testing tools for scanning the organizational infrastructure for possible vulnerabilities."

Here's what Verizon found: 81% of breaches start with bad passwords. That's why you need these policies:

Policy Type	Description	Update Frequency
Access Control	User permissions	Monthly
Information Security	Data protection	Quarterly
Acceptable Use	Password rules	Bi-annually
Risk Management	Security checks	Monthly

For your SOC 2 audit, keep these records:

Record Type	Content	Retention
Policy Changes	What changed	1 year
Access Logs	Who accessed what	2 years
Incidents	Security events	3 years
Training	User education	1 year

Use Specops to check for:

• Weak passwords
• Expired credentials
• Unused accounts
• Policy violations

This setup meets SOC 2's CC6.1, CC6.2, and CC6.3 requirements for access control and system security.

Keep Your Password Rules Current

Here's what NIST says about checking and updating your password rules:

Review Type	Frequency	What to Check
Policy Review	Every 365 days	Password length and complexity rules
Access Audit	Monthly	User permissions and inactive accounts
Security Scan	Weekly	Password database against known breaches
Breach Check	Daily	Signs of compromise or unusual activity

NIST has changed many traditional password rules. Here's what's different now:

Old Rule	New NIST Rule	Why
Change every 90 days	Change only if compromised	Users pick better passwords when they change them less often
Mix special characters	Focus on length (8+ chars)	Length beats complexity for password strength
Block password reuse	Check against breach databases	Stops people from using known leaked passwords
Complex requirements	Allow all ASCII/Unicode chars	Makes passwords easier to remember

The data makes it clear:

Statistic	Impact
80% of breaches involve weak passwords	Regular checks catch weak passwords
62% of users reuse passwords	Daily breach monitoring helps spot risks
89% know password reuse risks	Staff training needs regular updates

Here are the tools you need:

Tool Type	Purpose	Update Schedule
Password Scanner	Find weak passwords	Daily scans
Breach Monitor	Check for compromised credentials	Real-time alerts
Access Logger	Track login attempts	Weekly review
Policy Enforcer	Ensure rule compliance	Monthly check

NIST's take: "Password expiration isn't needed as a general practice. Only reset passwords when there's a known compromise or once every 365 days."

For SOC 2, keep these records:

Record	Content	Keep For
Policy Updates	Changes to password rules	1 year
Security Checks	Results of password scans	2 years
Access Reviews	User permission updates	1 year
Breach Reports	Security incidents	3 years

Check your password database against known breaches every day. If you find matches, make those users change their passwords immediately.

Conclusion

Here's what makes a SOC 2 password policy work:

Component	Impact	Key Requirement
Password Length	Takes 200+ years to crack at 1T guesses/sec	Minimum 12 characters
MFA Setup	Blocks 99% of automated attacks	Required for all users
Password Manager	Reduces password reuse by 85%	Company-wide deployment
Account Lockout	Stops brute force attempts	After 5 failed tries
Password History	Prevents password recycling	Keep last 6 passwords

Let's look at the data that shows why this matters:

Statistic	Source	Impact on Security
81% of breaches use weak passwords	Verizon 2020	Makes strong passwords critical
$3.86M average breach cost	IBM Security	Shows high stakes of password security
15B passwords on dark web	1Password	Shows need for unique passwords

Here's how big companies put this into action:

Company	Tool Used	Results
IBM	1Password	Cut password resets by 75%
Slack	Password Manager	Zero password breaches
Dropbox	MFA + Password Tools	Stopped credential stuffing

"SOC 2 password requirements play a crucial role in strengthening cybersecurity defenses and ensuring compliance with industry standards."

These password rules do two things:

• Block common attacks like password spraying and credential stuffing
• Give clear proof for SOC 2 audits

The magic happens when you combine these elements. Strong passwords + MFA + the right tools = better security.

Quick tips for success:

• Run daily password checks against breach lists
• Update your rules once a year
• Train your team every month
• Keep 3 years of records

Follow these steps, and you'll nail SOC 2 compliance while keeping your systems locked down tight.

FAQs

What are the password requirements for SOC 2?

Here's what SOC 2 needs for passwords:

Requirement	Specification	Why It Matters
Length	12-16 characters minimum	Takes 200+ years to crack at 1T guesses/sec
Password Changes	Every 90 days	Limits exposure if compromised
Password History	Last 6 passwords	Stops password recycling
Account Lockout	After 5 failed attempts	Blocks brute force attacks
MFA	Required for all users	Stops 99% of automated attacks

Think of these requirements as your digital security fence. Each element adds another layer of protection.

"Passwords are the first defense against unauthorized access to personal or sensitive information."

What is the NIST compliant password policy?

NIST takes a different approach. They focus on making passwords LONGER instead of more complex:

NIST Requirement	Details
Minimum Length	8 characters for user-created passwords
Maximum Length	Up to 64 characters
Character Types	Any ASCII/Unicode characters (including spaces and emojis)
Password Changes	Only when compromised
Password Checks	Must screen against known breached passwords

"Longer passwords are generally more secure and easier for users to remember."

Here's how NIST differs from SOC 2:

• No forced password changes
• No rules about mixing characters
• Checks for compromised passwords
• Focuses on length over complexity

The bottom line? NIST wants passwords that are hard to crack but easy to remember. It's like picking a phrase instead of a complex word.

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