Answers · CMMC & AI compliance
HoundShield vs Nightfall for CMMC: which is compliant?
For CMMC and DFARS 7012, the deciding question is where the scan happens. HoundShield scans AI prompts locally, on your own hardware, so CUI never leaves your boundary. Cloud-based AI DLP tools such as Nightfall, by their published architecture, inspect content in the vendor's cloud — which means a prompt is transmitted off-network to be scanned, the very exposure DFARS 7012 forbids.
The architectural difference that decides compliance
Both tools aim to stop sensitive data reaching AI models. The difference is the data path. A local-only firewall inspects the prompt inside your network and blocks CUI before anything is transmitted. A cloud DLP, by design, must first receive the content in its own cloud in order to classify it.
For a defense contractor handling CUI, that distinction is not cosmetic. Transmitting CUI to a third-party cloud — even a security vendor's — moves it outside your covered system. CMMC assessors evaluate where CUI flows, not the intent of the tool that moved it.
Side-by-side for a defense contractor
| For CMMC / DFARS 7012 | HoundShield (local-only) | Cloud AI DLP (e.g. Nightfall) |
|---|---|---|
| Where prompts are scanned | On your hardware / in-network | In the vendor's cloud |
| Does CUI leave your boundary to be scanned? | No | Yes — to be inspected |
| Self-hosted / air-gapped option | Yes (Docker, on-prem, air-gapped) | Cloud-dependent by design |
| Covers ChatGPT, Copilot, Claude, Cursor | Yes — OpenAI-compatible proxy | Varies by integration |
| C3PAO evidence (SSP / POA&M / SPRS) | Built-in, SHA-256 signed | Not a CMMC evidence tool |
Why local-only wins for CUI
The compliant pattern is to scan before the data leaves, on a system you control. HoundShield's interception runs on your hardware and maps directly to NIST 800-171 controls 3.1, 3.13 and 3.14, then exports a tamper-evident audit trail for your assessor.
Cloud AI DLP can be an excellent fit for organizations without CUI obligations. But for the defense industrial base, a tool that transmits the prompt to scan it cannot, by its own architecture, guarantee CUI stayed inside the boundary.
FAQ
Frequently asked questions
Use AI without leaking CUI
HoundShield scans every AI prompt locally and blocks CUI before it leaves your network. One URL change. Under 10 minutes. C3PAO-ready.