How to Keep Sensitive Financial Information Safe

In the digital age of information, keeping confidential company information safe is becoming increasingly more important. Concerns about cyber security continue to grow, as more and more reports of data breaches and information leaks from businesses are reported.

To safeguard your business and client sensitive information, business owners need to take a more proactive approach to protecting this data. Here are a few strategies to make sure that your digital information and documents remain secure no matter what platform you are using to store this information.

1. Create Strong Password Policies

One of the most basic but most effective ways to protect sensitive information is by using strong, unique passwords for any accounts that have access to privileged information. Create guidelines for your employees to follow when creating passwords for accounts that access business information. These guidelines should include criteria such as:

• Use Long Passwords: Aim for passwords with at least 12 characters.
• Combine Characters: Mix uppercase and lowercase letters, numbers, and special characters.
• Avoid Predictable Patterns: Don’t use easily guessable information like birthdays names or common words.
• Change Passwords Regularly: Update passwords every few months and avoid reusing them across different accounts.
• Create a Secure Password Storage System: Consider using a password manager to create and store your passwords securely. 1Password or Bitwarden are good choices when it comes to business password managers.

2. Enable Two-Factor Authentication (2FA)

Enabling Two-Factor Authentication to your accounts can add an extra layer of security to your accounts by requiring a second form of verification in addition to your password, when attempting to login. This could be a text message code, an email, or an authentication app. Enabling 2FA can significantly reduce the risk of unauthorized access and give you a warning if someone does try to access your information.

3. Use Encryption

Encryption transforms your data files into a secure format that can only be opened by someone with the correct decryption key. Encrypting files that have extra sensitive information before uploading them into a document management system or emailing them can help protect the information in the files even if your account password does end up getting compromised at some point. Follow these best practices to protect your data:

• Data at Rest is Encrypted: Protect data stored on your devices and servers.
• Data in Transit is Encrypted: Secure data being transmitted over networks using SSL/TLS protocols.

4. Regularly Update Your Software

Software updates often include patches for security vulnerabilities. Make sure that you are keeping your operating systems, applications, and security software up to date. Enable automatic updates where possible and regularly check to see if there are any new updates that need to be installed to ensure you’re always running the latest versions.

5. Backup Data Frequently

Regular backups protect you from data loss from a cyberattacks, hardware failures, or other disasters. Follow these best practices to ensure that you don’t lose important information incase of an incident:

• Automate Backups: Schedule regular automatic backups.
• Use Multiple Locations: Store backups both on-site and off-site (or in the cloud).
• Encrypt Backups: Ensure that your backup data is encrypted for added security.

6. Implement Access Controls

Not everyone in your organization needs access to all financial information. Be strict about who can have access to what information and let up controls to ensure that employees only have access to the information they are authorized to see. This helps limit the exposure of sensitive data. Consider:

● Role-Based Access: Assign access based on job roles and responsibilities.

● Monitor Access Logs: Regularly review access logs to detect any unauthorized attempts.

● Limit Admin Rights: Restrict administrative privileges to reduce the risk of misuse.

7. Educate Your Employees

Human error often has a large role to play in many data breaches. Educating your employees about your security policies and data protection best practices is the best way to combat this and mitigate the risk of accidental data breaches. Conduct regular training on:

• Recognizing Phishing Scams: Teach employees how to spot suspicious emails and links.
• Secure Data Handling: Teach them proper procedures for managing and storing sensitive information.
• Reporting Incidents: Encourage prompt reporting of any security concerns or incidents.

8. Conduct Regular Security Audits

Schedule regular security audits to help you identify vulnerabilities in your system. These audits can be conducted internally by your IT team or you can hire a third-party security firm. Key components to include in your audit are:

• Penetration Testing: Simulate attacks to identify weaknesses.
• Vulnerability Assessments: Regularly scan for and address security gaps.
• Compliance Checks: Ensure your security practices meet any regulatory standards.

9. Use Secure Software

When you are deciding on what software to use, especially for storing your financial information, choose platforms that prioritize security. Look for features such as:

• End-to-End Encryption: Ensures data is encrypted from the moment it’s entered until it’s received.
• Secure Cloud Storage: Data stored in the cloud should be encrypted and hosted by reputable providers.
• Regular Security Updates: Choose software that is frequently updated to address new security threats.

10. Develop a Response Plan

Despite your best efforts, sometimes breaches still occur. Having a response plan in place, in case this happens, ensures you can act quickly to minimize the damage. Your plan should include:

• Incident Response Team: Designate a team of IT professionals who will be responsible for managing breaches.
• Notification Procedures: Outline how and when you will notify affected parties and authorities.
• Recovery Steps: Detail the steps you plan to take to contain, investigate, and recover from the data breach.

Be proactive about your security and protect your business from the ever-evolving landscape of cyber threats. Contact us and learn what LedgerDocs is doing to make sure that we provide a safe and secure platform for your business to store information.