This is third of a five-part series on Maximizing E-mail Security ROI.
E-mail is an easy, cheap and readily available form of communication. It’s a great tool for businesses, but without proper safeguards in place to regulate information transmitted it can also be a potential threat. An effective e-mail policy should be all-encompassing, helping organizations comply with federal regulations, protect intellectual property and prevent offensive materials from being transmitted across their networks.
Companies in healthcare and financial industries are compelled by law to ensure that they meet strict requirements with regards to patient and customer information privacy. In addition, virtually all publicly traded companies must now implement measures to prevent leaks of confidential corporate information. A large part of complying with these regulations involves implementation and enforcement of corporate e-mail policy.
According to The ePolicy Institute’s “2003 E-Mail Rules, Policies and Practices” study, only about half (52%) of 1100 U.S. companies surveyed have any form of e-mail monitoring and policy enforcement. Even more alarmingly, only 19% monitor internal e-mail and only 39% monitor outgoing e-mail, leaving a large majority of American businesses wide open to a litany of harsh consequences. These consequences include financial penalties due to violations of federal legislation, loss of competitive advantage from breaches of confidentiality, lawsuits from employees alleging a hostile work environment and destruction of company reputation as a result of disgruntled employees or irresponsible e-mail use.
This week’s newsletter will focus on issues surrounding e-mail policy enforcement and what companies can do to ensure that they are not harmed by regulatory violations, intellectual property loss, costly litigation and embarrassing headlines.
In nearly every industry, e-mail is primary method of communication, both internally and outside organization. Healthcare professionals use it to collaborate with colleagues and staff and correspond with patients. Banks, brokerage firms, insurance companies and tax preparation firms use it to communicate with customers and partners and perform countless millions of online transactions every day. Company employees and executives use e-mail to relay messages discussing corporate financial performance, proprietary product information and human resource records.
The ever-increasing reliance on e-mail is has brought with it federal legislation such as Health Insurance Portability and Accountability Act of 1996 (HIPAA), Gramm-Leach Bliley Act of 1999 (GLBA) and Sarbanes-Oxley Act of 2002 (SoX), mandating protection of confidential information that is stored on, or accessible through, enterprise networks. Generally speaking, this legislation is designed to compel businesses to:
Failure to comply with information privacy laws due to violation of company policy carries with it stiff financial penalties for enterprise (up to $250,000 per incident) and possible criminal charges and jail time for company executives. The good news is that a comprehensive messaging security approach can play a major role in maintaining a company’s information integrity, greatly enhancing its return on security investment.
- Ensure that e-mail messages containing confidential information are kept secure when transmitted over an unprotected link;
- Ensure that e-mail systems and users are properly authenticated so that confidential information does not get into wrong hands;
- Protect e-mail servers and message stores where confidential information may be stored; and
- Identify and track information that must remain confidential.
Asset and Intellectual Property Protection
Among a company’s most important assets are its proprietary product- or service-related data and other information designed to attain competitive advantage. However, e-mail’s prevalence and ease of use make it a ticking time bomb for companies wishing to protect this information. A study published by PC Week revealed that upwards of 30% of 800 employees surveyed admitted that they had sent confidential information such as financial reports, customer records or product data via e-mail to recipients outside company. Ten percent admitted receiving e-mail containing confidential information.
Not surprisingly, most breaches of confidentiality originate within a company. A classic example of this is Borland International, a U.S. software company. A Borland employee used company’s e-mail system to send confidential information to Symantec, his new employer and one of Borland’s main competitors. The information transmitted included product design specifications, sales data and information regarding a prospective contract for which both companies were competing. As a result, both (former) Borland employee and message recipient were charged with trade secret theft, and a civil lawsuit followed (though it would seem unlikely that any financial award could repair lasting damage caused by intellectual property loss).