Compliance A Major Lockbox Focus

By Mark Brousseau

Driven by more stringent internal controls and external mandates, Paul Diegelman (paul.diegelman@regulusgroup.com), vice president, business development executive, at Regulus, expects increased interest from lockbox clients in compliance this year.

“All companies rely on their internal controls, among other things, to ensure financial statement accuracy,” Diegelman told me. “Corporations are becoming increasingly focused on the task of remittance processing, to ensure that the internal or external remit processors have adequate controls in place, and that those controls are tested to ensure adequacy.”

Diegelman added that external mandates, such as HIPAA for healthcare and Regulation AB for financial services companies, are increasing the compliance requirements for internal and external processors alike.

Similarly, Diegelman foresees increased adoption of formal programs, such as ISO17799, that help control data security variables. These must include physical site access, encryption of data at rest, certain hiring policies, and penetration testing, among others, he said.

“A tremendous amount of sensitive information is managed by internal and external remittance processors,” Diegelman noted. “Looking at recent media reports, we know that breaches of this data bring significant reputation and financial risk to the holder of the data. Companies must now have some sort of documented and tested program to ensure that sensitive data is protected.”

What do you think? E-mail me at m_brousseau@msn.com.