Best Practices For Secure Disposal of IT Assets

When organizations dispose of old IT assets such as computers, hard drives, and other storage devices, they are at risk of compromising data security unless proper data destruction methods have been followed for destroying information beyond recovery. Data disposal is often misunderstood with data deletion or device formatting. It is a big myth around data disposal that simply deleting files or reformatting a device will erase data permanently. Deleting merely removes the file linkages with the memory locations in the file system. Data still resides on the computer. Likewise, formatting wipes the storage partition table and unlinks the data in the file system. It re-indexes the file system for reusing the drive. Here also data is residing in the machine. In both cases of deletion and formatting, data remnants are recoverable via DIY freely available data recovery tools or via in-laboratory services.

Organizations, therefore, must practice secure data destruction methods such as secure data erasure, degaussing, and shredding to render data irretrievable from any technique.

Why Must Organizations Prioritize Data Destruction?

Data destruction is critical because improperly disposing of storage devices can lead to leakage of business-critical information and violations of data privacy regulations, resulting in penalties and lawsuits. Many organizations fail to sanitize their IT assets before recycling or disposing of them, allowing sensitive data to remain on the devices. According to the world’s second-largest Residual Data Study, 7 out of 10 devices made available in the second-hand market had residual data in it comprising of intellectual property, PII information, passport details, banking passwords, credit information, social security numbers, etc. This demonstrates how vulnerable we are to compromising our data security due to improper device disposal.

Data protection must be a priority when disposing of storage devices to safeguard sensitive information, uphold legal compliance, maintain the trust of customers and partners, and prevent reputational damage from potential breaches due to improper device disposal. Let’s look in detail at the repercussions organizations can face if the devices are not disposed of properly.

●    Data Breaches – Businesses that fail to securely wipe or destroy their data-bearing devices face substantial data breach risks. Morgan Stanley incurred two data breach episodes where, due to improper disposal, they faced penalties of $60 million and $35 million. An IBM study also shows that “the global average cost of a data breach in 2023 was USD 4.45 million, a 15% increase over three years.”

●    Penalties and Lawsuits due to Violation of Compliances – There have been numerous instances where storage devices were disposed of containing remnants of confidential data. In such cases, companies are at risk of violating regulatory compliance with laws like CCPA, EU-GDPR, HIPAA, PCI DSS, and FACTA, which govern consumer data privacy and lead to financial burdens. HIPAA violations in case of data breaches can result in fines of up to $1.5 million per incident, while GDPR fines can reach up to 4% of global annual turnover or €20 million. As an example, Maine Healthcare Community Center compromised 100,000 records, which led to HIPAA Non-Compliance and ultimately to huge penalties. 

●    Reputation damage – Data breaches that expose sensitive records can severely damage an organization’s reputation and trust among consumers, stakeholders, and the public. Failing to discard sensitive data housed on devices appropriately makes companies susceptible to breaches that could potentially diminish customer loyalty, revenue, stock value, and overall position.

Best IT Asset Disposal Practices To Follow

Organizations can abide by the following best practices when disposing of storage devices like hard drives, flash drives, PC, Laptop, Server, Mac, and mobile devices:

●    Adhere to the Data Destruction Policy

Organizations must have a secure data destruction policy defined for disposing of storage devices to prevent data breaches. It is recommended that the National Institute of Standards and Technology (NIST) guidelines for media sanitization be followed, which comes in handy for organizations to sanitize devices based on device type. 

Data destruction techniques like Degaussing and physical shredding have their consequences on the environment, and it doesn’t guarantee the complete removal of data. However, data erasure is a reliable method that guarantees permanent erasure beyond the scope of recovery. Having formal procedures for device disposal in the form of policies and employee training ensures that best practices are adhered to at all times within the organization.

●    Destroy the Data Backups that are not needed

Organizations should destroy obsolete data along with its backup files and folders when disposing of storage devices to prevent sensitive information from falling into the wrong hands. Completely wiping data ensures that malicious actors cannot access confidential material. The best practice is to use data wiping tools to make it irretrievable. This simple step secures organizations against data breaches via decommissioned devices.

●    Maintain Chain of Custody records

Businesses should maintain detailed chain of custody records when disposing of storage devices to track their movement and ensure proper handling. Documenting each step from initial to final device disposal provides accountability, demonstrates compliance, and proves to be useful during audits, especially if a data breach happens. The best practice is to capture asset tags, dates, personnel involved, and procedures performed. This is a security measure that protects organizational interests if fingers are pointed down the road.

●    Demand Certificate of Destruction (COD)

A certificate of data destruction or sanitization is proof that the device and data were erased securely. It gives businesses peace of mind, considering confidential information cannot be recovered. Organizations can request these certificates from reputable IT asset disposition vendors who can verify the data sanitization.

●    Recycle your Data Storage devices

Recycling storage devices reduces electronic waste, conserves resources, minimizes the carbon footprint, and promotes a circular economy. However, the data residing within these devices must be completely wiped out before it is passed on to Non-Profits or handed down to others; otherwise, such devices may invite any cyber security threats. Organizations can implement this by partnering with certified recycling facilities that ensure proper data erasure before disposal. Through responsible disposal of old IT assets, organizations demonstrate their commitment to both the environment and data security.

Conclusion:

As data grows at a rapid speed, organizations increasingly rely on data storage devices. Proper sanitization through techniques like data wiping, degaussing, and physical destruction is critical before disposal to safeguard sensitive information. Adhering to best practices for secure device destruction ensures regulatory compliance, preserves public confidence, averts data breaches, and encourages sustainability. Companies need to establish robust data disposal policies that prioritize privacy protection, legal compliance, and overall digital security through responsible information management at the end of life.