Compliance

03:57 PM
Connect Directly
Facebook
Google+
Twitter
RSS
E-Mail
50%
50%

You’ve Got (potentially dangerous) Mail

Growing external e-mail threats and an evolving compliance and legal liability environment are forcing financial services firms to reevaluate their state of preparedness.

Millions Lost

Gundling recalls a real-life example in which a company spent an additional 200 man hours per day on remedial efforts in order to provide requested e-mail records to outside counsel, resulting in millions of dollars in costs. "With an effective e-mail archive solution, the entire cost is avoided and a successful investigation and litigation outcome is more likely," Gundling argues.

Chu Abad, vice president, IT, Seattle Northwest Securities Corp. (SNW; Seattle; $731 million in assets), deployed iLumin's Assentor archiving solution in 1999, soon after his arrival at the firm. The solution collects all internal, inbound and outbound e-mail, indexes the content, manages internally set retention periods and monitors for potential violations. Abad originally selected the product both on the strength of its functionality and a recommendation from the SEC and NASD. "At the time, iLumin was one of the vendors that did monitoring and capturing," he recalls. However, SNW reaffirmed its commitment to the product after an evaluation based primarily on functionality.

In July 2004, SNW integrated Assentor with Permabit's (Cambridge, Mass.) Permeon storage and retrieval component. The addition was dictated by a two-fold increase in storage demands resulting from regulatory document retention requirements, according to Abad. "Previous optical disk solutions were no longer cost-effective, so we had to seek an alternative that would be economical in terms of both costs and man hours," he relates.

This year SNW plans to add iLumin's Assentor Discovery product to facilitate high-volume searching of its archives. Discovery integrates well with both the base Assentor product and Microsoft Exchange. "When you get subpoenaed for documents, etc., it makes it much easier to create search criteria and parameters for generating results," Abad says. "It's a lot easier than doing [discovery] manually."

Abad reports that the solution has cost SNW less than $80,000, but he says that ROI is hard to measure. "ROI is not necessarily a monetary number, but rather the fact of being compliant with regulations," he says. "I do not want to think about the total value in fines that we could have faced had we not implemented Assentor."

Similar anxieties, along with productivity concerns, prompted an upgrading of protection against incoming e-mail threats at Oklahoma City-based American Fidelity Assurance Co. ($3.7 billion in assets), a provider of life, cancer, disability insurance, long-term care, hospitalization, tax-deferred annuities and flexible spending programs. The carrier formerly relied on a freeware antispam solution that was being overwhelmed by increasing e-mail volume. According to American Fidelity's chief security officer, Steve Dunkle, the insurer's IT department was "spending a tremendous amount of time trying to tune the solution to keep up with the increasing influx of spam." Consequently, it ran into the dilemma of "spend more time or just not keep up," he says. Given the department's other priorities, the result was to "not keep up," Dunkle recalls.

In May 2004, American Fidelity replaced the freeware solution with Tumbleweed's (Redwood City, Calif.) Email Firewall, along with the vendor's Dynamic Anti-spam Services (DAS) to filter and secure e-mail traffic. Among the most striking results of the implementation is that, while the former solution identified and quarantined about 18 percent of incoming e-mail as spam, the Tumbleweed solution captures more than 60 percent, with a minimum of false positives, according to Dunkle. It also blocks 99.99 percent of e-mail-borne viruses and provides the insurer with granularity of control, including filtering multimedia and graphic file attachments, according to a Tumbleweed source.

Anthony O'Donnell has covered technology in the insurance industry since 2000, when he joined the editorial staff of Insurance & Technology. As an editor and reporter for I&T and the InformationWeek Financial Services of TechWeb he has written on all areas of information ... View Full Bio

Previous
3 of 4
Next
Comment  | 
Print  | 
More Insights
Comments
Newest First  |  Oldest First  |  Threaded View
Register for Bank Systems & Technology Newsletters
White Papers
Current Issue
Bank Systems & Technology
BS&T's 2014 Elite 8 executives are leading their banks to success, whether it involves leveraging the cloud, modernizing core systems, or transforming into digital enterprises.
Slideshows
Video
Bank Systems & Technology Radio
Archived Audio Interviews
Join Bank Systems & Technology Associate Editor Bryan Yurcan, and guests Karen Massey and Jerry Silva from IDC Financial Insights, for a conversation about the firm's 11th annual FinTech rankings.