Cloud and network computing offers a lot of benefits, chief among which is providing enterprises and organizations the chance to migrate to a more agile IT infrastructure that allows them to streamline their work processes and make their electronic record keeping more efficient.
However, businesses and institutions are also often subject to a number of regulations, which require them to conduct their business in manners specified by the law in order to protect the personal information of their clients and customers. These regulations include the following:
The Payment Card Industry Data Security Standard is a set of standards administered by the PCI Security Standards Council, an organization founded in 2006 by leading card companies Visa, Mastercard, American Express, JCB International, and Discover. It is a set of technical and operational requirements that all companies and organizations processing payment transactions must abide by. These include financial institutions like banks, credit unions, insurance companies, investment fund companies, and security brokers. All manufacturers of devices and developers of software and applications that customers use to carry out these transactions are also required to follow the standards.
The intention of the council is to have financial institutions and companies exercise sufficient control over cardholder data in order to reduce the likelihood of such data being used for fraudulent activities. This is especially important for organizations that store data in the cloud. If you’re thinking of joining a credit union, make sure that its payment services are PCI compliant. American interbank network CO-OP Financial Services for instance, provides PCI compliant services in all its 30,000 ATMs nationwide.
The HIPAA refers to the Health Insurance Portability and Accountability Act, a legislation that the American Congress passed in 1996. Its first part deals with regulating the availability, portability, and renewability of individual and group health care plans, while its second part defines the provisions for safeguarding the privacy and security of people’s health information. Furthermore, it also outlines the applicable civil and criminal penalties that can be imposed on companies or organizations that violate these provisions.
The HIPAA mandates enterprises to follow transaction standards and to put into place measures that will protect the individually identifiable health information of patients. In addition, it also determines the guidelines for investigations into violations of compliance standards.
The Sarbanes-Oxley Act is another piece of legislation passed by the U.S. Congress, this time in 2002, in order to introduce measures aimed at regulating corporate financial practices. Its main goal is to protect investors and the public in general from erroneous accounting as well asfrom acts of deliberate fraudand accounting malpractice committed by companies and organizations. It is administered by the Securities and Exchange Commission.
SOX sets compliance guidelines not only for the enterprises’ financial departments, but also for their IT departments, which are responsible for keeping their respective companies’ accounting records.
SOC2 is another set of accounting standard that many companies follow. It refers to the Service Organization Control 2, which are internal control reports issued by the American Institute of Public Accountants (AICPA). These reports are employed by a company’s stakeholders to gain a thorough understanding of the organization’s internal controls, the AICPA notes, “as it relates to security, availability, processing integrity, confidentiality, and privacy.”
Although they might not be that apparent to the general public, these federal and state regulations have been created by their authors with the express intention of protecting people from fraud and from the illegal use of their personally identifiable information. If you are managing your company or financial institution’s digital assets, it is important to make sure that your organization complies with these regulations to avoid being exposed to damaging and potentially expensive legal issues.