Industries That Must Follow Strict Compliance Laws

Compliance is an essential aspect of any business strategy. But the data shows many organizations aren’t giving it the attention it needs.

This doesn’t come without consequences. As well as putting the organization and its customers at risk, the cost of non-compliance is expensive.

A  paper published in December 2017, by Ponemon Institute, highlights this:

The range for compliance cost is $0.58 million to $21.56 million. The range for non-compliance cost is $2.20 million to $39.22 million. As seen here, in all but two cases, non-compliance costs exceeded compliance costs.

Although it should be a consideration for all businesses, there are some industries impacted more than others. Here are three industries that must follow strict compliance laws:

The Financial Industry

Unsurprisingly, the financial industry is subject to many compliance laws, including:

• Anti-money laundering regulations (e.g. ,The Bank Secrecy Act)
• Data management and protection
• Data security legislation (e.g., PCI DSS)
• Laws that govern the provision of services in the financial industry (e.g., the Secure and Fair Enforcement for Mortgage Licensing Act)

This means businesses operating in this sector have some of the highest compliance costs and should budget accordingly.

Data also suggests the costs are increasing. A 2018 report from Quantivate highlights this:

“The average cost of compliance for financial services companies nearly doubled between 2011 and 2017, from $16 million to $30.9 million.”

It’s apparent that mistakes in this industry can be extremely costly. Organizations should ensure they have sufficient resources to ensure compliance.

If this isn’t feasible, a managed IT service provider can help. But you should ensure they have specialist knowledge in the finance industry. An understanding of the laws that impact your business is key to guarantee compliance.

The Retail Industry

While it’s true there are fewer regulations governing the retail industry, compliance shouldn’t be ignored.

There are still regulations that you need to adhere to.

For example, the Payment Card Industry’s Data Security Standard (PCI DSS) outlines the rules that any organization’s processing card payments must follow.

This regulation depends upon secure networks and systems, including the following:

• Firewalls
• Data encryption
• Secure storage
• A vulnerability management program to minimize the threat from cybercriminals.
• Effective IT security policies.

Many retail organizations do not have the resources to ensure compliance — but monthly fines up to $100,000 are issued for non-compliance.

If you can’t do this in-house, we recommend liaising with a third party to help you achieve compliance.

The Healthcare Industry

There are several compliance laws the healthcare industry must adhere to. This makes sense, given the sensitive nature of the data held concerning patients’ health.

The Health Insurance Portability and Accountability Act is one of them. This clearly states how patient medical information should be held securely — maintaining privacy at all times. It has important implications for different areas of your IT strategy, including:

• Backups
• Data storage
• Data transmission
• Access restrictions
• Disaster recovery processes

From helping you with a compliance audit to directly managing your IT provisions, there are many ways a third party can help healthcare companies keep patient data secure.

Sound like something you need more help with? Get in touch to find out more.