Digital copiers built since 2002 contain hard drives that store images of every document copied or scanned. Many of the stored documents include confidential data, leaving individuals vulnerable to identify theft if no safeguards are in place.

During a recent investigation, an expert downloaded tens of thousands of documents from old copiers available for sale using a free forensic software program. One copier contained files from a police department sex crimes unit; one contained addresses and social security numbers along with $40,000 in copied checks; and yet another contained 300 pages of individual medical records from a health insurance company. Armen Keteyian, “Digital Photocopiers Loaded With Secrets,” www.cbsnews.com (Apr. 19, 2010).

As is the norm with these investigative journalism pieces, the video is very sensationalized. The dangers are real though and should be treated with respect.

This report reveals the risk employers face when getting rid of old copiers. For example, during hiring procedures, employers make copies of employees’ social security numbers, birth certificates, drivers’ licenses and other personal information. With hard drives storing this information, employers run a huge risk of inadvertently divulging personal data for identity theft and violating a person’s confidential information.

Health records present a particularly risky situation if they are divulged. Federal privacy laws including the Americans with Disabilities (ADA) require that employers keep employee health records private.

Some copier manufacturers offer security or encryption packages that automatically erase an image from the hard drive after it is copied. Another company has developed software that can scrub all the data from copier hard drives. Because the hard drives on copiers are actually computers, IT experts should make sure the hard drives are clean and safe before they are resold or thrown away.

Employers should also take steps to make certain that employees do not steal recorded data from copiers as well. Particularly vulnerable are employers that copy social security numbers and medical records.

We have seen a long dry spell that included 2008 with just 43 IPOs and a first quarter 2009 that saw a single offering. 2010 is poised for a possible recovery with 53 companies that entered registration in 4th quarter 2009, the most new registrants in two years. (data gleaned from Ernst & Young’s latest IPO pipeline report) Technology claims the largest number of new registrants but the group as a whole cuts through all sectors. Average fund raising target is $190 million. but 24 of the new registrants are smaller companies seeking to raise less than $100 million.

Diversified Insurance Group has been a member of TechAssure almost since its inception.  TechAssure is a non-profit organization founded in 2001 for insurance and risk management professionals dedicated to serving clients in the Technology, Life Sciences, Digital Media, and Venture Capital industries.

Check out this video featuring John Love, the President of TechAssure

At the inception of TechAssure it was agreed that the insurance policies then in existence did not adequately address the major risks of the average technology or life science company. These companies were typically venture-backed and were growing rapidly. TechAssure members came up with a wish-list of coverage enhancements and pricing targets and partnered with the leading insurance carriers in these areas to create best-in-class coverage forms that are offered at preferred rates. TechAssure later did the same thing for Venture Capital and Private Equity Funds creating an Asset Protection Program endorsed by the NVCA that addresses the unique exposures that VC/PE managers and members have in running their funds. It is much like a D&O policy but tailored to cover big liability holes that exist for fund managers and members in the execution of their duties in their respective roles.

Each holiday season, we select what we consider to be the year’s most influential business book to share with our clients and partners. This year, we chose Free – The Future of a Radical Price by Chris Anderson as our firm’s 2009 Book of The Year.
 
We have simple criteria when picking our book of the year: 1) it must be published in the given calendar year, and 2) it needs to be both meaningful and enjoyable to read. While the selection formula is straight forward, the process of selecting our book is never easy. There are always varied opinions and good options from which to choose. We have chosen Free because the main idea of the book resonated with our firm’s culture and philosophy. It is the intriguing idea that you can make more money by giving services and products away for free.
 
As a professional service provider, we constantly give away our intellectual property for free. Gone are the days when you can simply say you’re an expert and expect to receive someone’s business. You must now fully demonstrate your value proposition and do it in a way that is both meaningful and economically neutral. The fascinating paradox explored in this book is that the more you give away, the more you receive in return. And the game-changing part of this “free,” is that it is not a twentieth-century marketing gimmick with strings attached. Twenty-first-century “free” really is free.
 
It’s a time-honored holiday tradition that giving is more important than receiving. Can this same principle of giving things away be applied to the business world? Can an economic model that is built around the concept of “free” be sustainable, not to mention a way to build even greater profits for your business? The reason this book struck such a chord with us is that we see this principle proven all the time in our business dealings. Serving others and giving value away does increase returns and there is a multiplier effect.
 
If you get a chance, we’d appreciate your comments on the titles we’ve selected as our books of the year.

2005 The World Is Flat
2006 Small Giants – Companies That Choose to Be Great Instead of Big
2007 Wikinomics – How Mass Collaboration Changes Everything
2008 Outliers – The Story of Success
2009 Free – The Future of A Radical Price

Happy Holidays and Best Wishes in the New Year!
 
Diversified Insurance Group