When starting up a business, it’s important to educate yourself in order to make sure that the firm operates in accordance with the law. One of the keys to this is the DPA – the Data Protection Act. This act is administered by the Information Commissioner’s Office, and is applicable to any business which holds databases, emails or spreadsheets that contain customer information. Needless to say, this means that any company should take steps to ensure they’re in keeping with the legislation, whether by conducting a search for network security architecture reviews or working with a professional consultant.
But why is the data protection act in place? There are several reasons, and we’ll go over the main ones here:
Financial details can be lost
One of the biggest reasons for ensuring that all the data your company manages is kept secure is the simple fact that without doing so, you run the risk of it being used for illegal reasons: namely, money being stolen from the accounts of those concerned. Whilst any money taken should eventually be returned by insurance companies, that doesn’t mean that the theft might not be substantial enough to cause the clients and customers in question to cease trading. This is especially the case for any businesses that naturally have a more ‘lean’ period during certain times of the year.
Identity theft and security issues
One of the reasons that anyone working within the financial sector is shown films about the importance of data protection is that within this sector particularly, the potential for identity theft is substantial. Identity theft is the act of a person using confidential information about the victim for illegal reasons, such as accessing their bank accounts, using their credit cards and obtaining loans against any property they own. They might also use the information to try and blackmail the victim. Needless to say, identity theft can be extremely traumatic for those involved, and is enough reason in itself to ensure your data remains protected.
If you operate a retail business, then it is your legal duty to ensure that any data you have on record for your customers is kept secure. Consumers have the legal right for information about them to not be passed on without their consent. If you don’t take the necessary steps to ensure the information is kept safe, then you could be prosecuted and fined. Within the UK, fines can be up to £500,000.
Your reputation as a business
Without customers and clients, no firm can survive, and a big part of building relationships with these people is earning a reputation as a company that can be trusted. If you have a reputation for acting professionally with the information of your clients, then more clients will want to work with you. Vice versa, no company will survive if potential customers feel it might be risky to work with them. If you want your business to succeed, it is vital to ensure that you understand just how important business data protection is.