What is Chain of Custody & Why it is important for ITADs?

When IT Assets containing sensitive data are disposed of, transferred, or sold, data erasure and maintaining a secure chain of custody assume critical importance. A chain of custody helps in inventory reconciliation, maintaining data security, and mitigating the risks of data breaches or leakage. This blog explores the need to maintain the chain of custody and why ITAD companies must pay heed to it.

Data security is one of the biggest challenges businesses face in the era of evolving data protection laws. Companies are on guard due to rampant data theft, breaches, and dumpster diving. They spend millions of dollars to protect sensitive data and secure IT assets from cyber security threats. However, end-of-life IT assets are most vulnerable when disposed of, transferred, or sold.

A secure chain of custody is a vital step to ensure IT asset security and mitigate the risks involved in storing or transporting these assets.

What is Secure Chain of Custody & Its Importance?

As the name suggests, a secure chain of custody refers to safeguarding evidence or items during the transfer from one person/location to another. Simply put, a chain of custody is knowing and cataloging the location of the company’s assets and in whose possession they are at all times. Proper documentation is necessary when the IT assets leave the company premises and change ownership. In addition, it is essential for audit purposes and indemnification in case of a data breach or theft. This process is vital in the case of IT asset disposition, where data security and compliance are of utmost importance. There are several reasons why ITAD companies must pay heed to secure chain of custody, so as to:

• Ensure the safety and integrity of the evidence or items being transferred through audit trails and asset tags.
• Avoid any chance of tampering or contamination of the evidence or items
• Establish a clear and undisputed chain of custody, which can be used as evidence in court if necessary
• Identify inventory through asset tags and ensure seamless inventory reconciliation
• Maintain the confidentiality of the evidence or items being transferred
• Comply with data security and privacy regulations (such as GDPR and CCPA)

Therefore, a secure chain of custody is vital to IT asset disposition and something that all ITAD companies should take seriously.

Risks Associated With Not Maintaining a Secure Chain Of Custody:

A secure chain of custody is necessary for data safety and security because it helps prevent data breaches and other security risks associated with improper asset disposal. Unfortunately, the risks associated with not maintaining a secure chain of custody are plenty; here are a few reasons why:

• Without a secure chain of custody, system integrity and associated data are at risk.
• Whether digital or physical, it becomes nearly impossible to ensure the validity, accuracy, or security of the records in question.
• An absence of a secure chain of custody prevents any organization from identifying if a system has been compromised. Such systems are vulnerable to malware attacks by a malicious actor who might access the system and alter/erase the data.
• The systems and data might not be allowed or entertained as evidence in a court of law.

Numerous cases have been witnessed where not maintaining a secure chain of custody resulted in huge losses and data breaches. For example, the National Health Service in the UK was fined GBP 200,000. This breach happened because the IT disposition vendor hired by NHS didn’t sanitize the computer before selling it online, which contained the personal information of over 3000 patients.

Another more recent case happened with Morgan Stanley when they were fined by the OCC ($60 Million) for improper disposal of their IT assets that were later found to contain confidential data of over 15 million customers.

Both these examples tell us that if a proper chain of custody was maintained and documented, severe fines and penalties could have been avoided. Instead, when such breaches happen, they result in heavy financial losses, legal ramifications, and customers’ losing trust in the brand.

How to Ensure a Secure Chain of Custody:

Maintaining a secure chain of custody means tracking the movement of IT assets from the moment the company no longer needs them until they are correctly disposed of. There are several critical steps involved in maintaining a secure chain of custody:

• Cataloging and asset tagging the device throughout the IT assets lifecycle
• Granting employees only the privileges required to fulfill their tasks (Principle of Least Privilege)
• Making sure remote access is controlled and network integrity is preserved
• Safeguarding information’s confidentiality, integrity, and accessibility,
• Managing data and records per the organization’s risk management strategy
• Ensuring proper sanitization or destruction of data on all devices before they leave the company’s control
• Maintaining reports and certificates of data destruction
• Using data destruction techniques as prescribed by the regulatory norms
• Tracking devices as they move through the disposition process
• Working with a reputable IT asset disposition (ITAD) vendor specializing in secure data destruction and device recycling
• Ensuring all devices are disposed of in a safe and environmentally-friendly manner

The above points can be implemented by businesses and ITADs alike to ensure the least amount of risk is involved while moving and disposing of the IT assets. The policies must be devised according to the business needs and prevailing federal & state laws that govern the business.

Conclusion:

Businesses should routinely audit chain of custody procedures to establish that the integrity of the data is upheld across all phases of the device lifecycle. In addition, the effectiveness and durability of the policies, practices, systems, and training should be regularly evaluated through audits. By following the secure chain of custody, companies can rest assured that their data and devices are in safe hands.

About The Author

Shuja

Shuja is an enthusiast and an expert in content marketing and public relations at Stellar. He has 13+ years of experience in Technical Content Writing and Corporate Communications across Software and IT Consulting industry. He enjoys writing content on subjects related to data erasure, data breaches and privacy laws. Shuja spends most of his time acquiring ITAD industry-related information and on weekends likes to relax with family and kid.