Data security is such a huge topic it would be impossible to cover all aspects in one blog post. However, it amazes me in this day and age with the ever-increasing access to ‘free’ online apps and tools that many online users don’t check the T&Cs on these tools. How many of us actively read through and check to see how our data is being used and stored, and do we understand how securely it is stored?
Just last year alone a friend of mine had her personal email hacked several times and I wonder what data was actually stolen from her and how it’s being used?
In a report by Cifas, in 2014 there were 276,993 frauds recorded by Cifas members, an increase of 25% on 2013 levels – recorded fraud is increasing!
From a business perspective the risks are obviously increased as businesses are responsible for huge volumes of client data. But, as with individuals, how many businesses think about data security? In a report from McAfee they found almost 90% of small and medium-sized businesses in the US did not use data protection for company and customer information - a staggering statistic.
Obviously it’s not just email that’s a potential problem, for many it’s also how their client data is stored. In the financial services sector, I wonder how many advisers still use filing cabinets for storing paper client files? Moving to a digital approach should help, but I’m sure there are still firms with scanned documentation held on a laptop or PC. We’ve probably all been there “I’ll move these documents later” and several days have passed before they get moved to a secure location. Ideally financial advisory firms would want to be able to have business data, client documentation and client communication activity all housed securely in the one place and know that it enjoys world-class data and physical security. Of course, there are also regulatory requirements for client data which cannot be ignored. For firms looking for advice, the FCA have put together guidance on what to consider when storing client data.
If you’re going to use one of the current practice management technology systems, it’s really worth asking for their technical spec on data security. Intelliflo for example takes financial data very seriously - Benefits of a web-based solution details the main points a practice management or back office system should have. In addition, there is also a great fact sheet for advisers on how to communicate with their clients securely using the Personal Finance Portal’s secure messaging feature.