MCP Server : Compliance Team’s Playbook

TL;DR

Stand up MCP with a control system that turns every agent action into exportable evidence. You will inventory tools and data flows, enforce residency and minimization in the path, map controls to frameworks, and ship audits as downloads instead of hunts.

Who this is for

Compliance, GRC, Privacy, Risk. You translate regulation into operating controls, require evidence, and close audits.

What you will ship

• AI Bill of Materials (apps, agents, MCP servers, tools, vector stores, external APIs)
• Data classification and residency rules enforced at call time
• Purpose-scoped non-human identities with short TTL and elevation trails
• Evidence bundles mapped to frameworks and ready to export
• Policies for allow, deny, redact, route, and vendor allow lists
• Quarterly review cadence and tabletop rehearsals

Play 1 - Inventory and classify (Week 1)

Goal: Know what exists and what data moves.

Steps

1. Auto-discover agents, MCP servers, tools, resources, vector stores, external APIs.
2. Tag each with owner, purpose, data classes touched (PII, PHI, PCI, secrets), regions.
3. Record processing purposes and lawful bases where required.

Artifacts

• AI BoM (CSV or JSON) with owners and data classes
• Article 30 style register for high-risk flows

Metrics

• Catalog coverage %, owner coverage %, % entries with data class tags

Play 2 - Residency and minimization in the path (Week 1 - 2)

Goal: Enforce data rules where work happens.

Steps

1. Write policy to route EU data to EU systems, deny unknown vendors, redact sensitive fields.
2. Default to minimal selects and masking on exports.
3. Block cross-border calls unless a transfer mechanism is recorded.

Policy example

- rule: route-eu-data
  when: { data.contains_pii: true, subject.region: "EU" }
  route: "eu-west"

- rule: redact-email-default
  when: { tool: "orders.export" }
  decision: allow
  redact:
    - field: "email"
      mode: "mask"

- rule: vendor-allow-list
  when: { egress.domain: "*" }
  decision: deny
  unless: { egress.domain_in_allowlist: true }

Metrics
Redactions per 1k actions, denied unapproved egress, cross-region blocks

Play 3 - Non-human identity and least privilege (Week 2)

Goal: Prove who acted, with what authority.

Steps

1. Issue short-lived tokens per agent and per tool with purpose scopes.
2. Require JIT elevation with approver, reason, TTL for high-risk tools.
3. Log grants and revocations with signatures.

Evidence snippet

{
  "principal": "agent:release",
  "scope": "flags.write:prod",
  "approved_by": "oncall-sre",
  "reason": "hotfix-1234",
  "ttl_sec": 900,
  "signature": "base64..."
}

Metrics
Median token TTL, elevation approvals/denials, % tools with narrow scopes

Play 4 - Evidence bundles and exports (Week 2 - 3)

Goal: Audits become exports.

Steps

1. Define evidence schemas per control theme: identity, policy, redaction, routing, decision logs.
2. Enable OpenTelemetry traces with identity and policy attributes.
3. Export signed bundles to your SIEM or evidence vault with retention.

Bundle example

{
  "control": "Data protection in transit",
  "period": "2025-08-01..2025-08-31",
  "artifacts": [
    {"type":"trace-sample","count":1000,"attrs":["actor.id","policy.decision","pii.count"]},
    {"type":"policy-decisions","allow":8392,"deny":112,"redact":1491},
    {"type":"routing","eu_west_routes":441,"blocked_cross_region":23}
  ],
  "signature": "base64..."
}

Metrics
Time to export evidence for a sampled week, completeness % by control

Play 5 - DPIA / risk assessment for AI workflows (Week 3)

Goal: Assess and document risk quickly.

Steps

1. Template a DPIA with purpose, data categories, recipients, safeguards, residual risk.
2. Attach spans, policies, and elevation trails as proof of safeguards.
3. Approve with expiry and review date.

DPIA checklist

• Purpose and lawful basis
• Data categories and regions
• Redaction and routing controls
• Vendor list and contracts
• Residual risk and approval

Play 6 - Framework mapping and gaps (Week 3 - 4)

Goal: Map to NIST AI RMF, ISO/IEC 23894, SOC 2, ISO 27001, GDPR.

Matrix

Metrics
Controls with direct evidence %, gaps with remediation owners

Play 7 - Retention and deletion (Week 4)

Goal: Keep what you must, delete what you should.

Steps

1. Retain traces 30–90 days, evidence per regulatory requirement.
2. Automate user data deletion where applicable, including in vector stores.
3. Verify deletion with checksums or counts.

Retention table (example)

Play 8 - Reviews, tabletop, cadence (Quarterly)

Goal: Keep it live and demonstrable.

Steps

1. Quarterly catalog drift report and scope review.
2. Tabletop: export evidence for a random week in 30 minutes.
3. Update DPIAs and vendor lists.

Metrics
Time to tabletop evidence, # drift findings resolved

KPIs to track

• % actions with signed traces
• Policy decisions: allow, deny, redact, route
• Time to evidence for a sampled week
• Audit exceptions, mean time to remediate
• Elevation approvals with reason and TTL

Ops and due-diligence checklist

• AI BoM with owners and data classes
• Residency, minimization, vendor allow lists enforced
• Purpose scopes, short TTLs, elevation trails
• Evidence bundles signed and exportable
• DPIA templates and live examples
• Framework mapping matrix with gaps and owners
• Retention schedules implemented

How Levo can help

Levo provides mesh visibility, identity-first governance for non-humans, inline redaction and routing, signed evidence bundles, and drift and DPIA support. Audits become exports and privacy rules run in the path of action.Learn more: Levo MCP server use case → https://www.levo.ai/use-case/mcp-server