How to Achieve Safe and Secure Online Marketing
The Security Exchange Commission (SEC) has just conducted its own survey to determine which among the fifty leading companies in the US is “Safe and Secure”. The survey was done using a qualitative scale, with two questions: Did the company do a good job of safeguarding confidential data? And, did the company provide an adequate level of protection to the personal information of its customers? The results showed that only eighteen percent of all the top companies in the US are actually safe and secure.
Only one out of twenty of the largest companies in the world registered that it was doing a good job in securing its customers’ personal information. Only five out of the top twenty registered that it was providing an adequate level of protection. Only two out of twenty-one US corporations are authorized to process credit cards for their customers. This is not good enough, is it?
Would you put your financial or personal information at risk if the company did not do a good job of guarding your personal information? I think not. The same holds true for companies that want to raise capital. It is extremely important to raise capital. However, companies who choose to raise their funds based on confidential and non disclospiable information, rather than raising capital based on investor demand, may find themselves seeking government regulation. If they were to receive a notice from the SEC or other regulatory agency that they have not followed safe and secure practices in connection with their fundraising activities, there will be severe consequences for both the company and the investors.
According to a definition by the SEC, a company’s use of online or electronic means for purposes of managing customer relationships, protecting financial information, or engaging in other securities transactions, does not give rise to a private right of action on the part of the investor. It also goes on to state that the use of such methods does not create a fiduciary responsibility to the investor. It would appear to be an open field when it comes to using online methods to solicit investment capital. However, the SEC has taken an indirect approach to regulating online and internet based securities offerings, holding companies have to register with the SEC and meet certain requirements.
On the one hand, the SEC wants to ensure that all online securities offered are robust and secure. In order to accomplish this task, the SEC makes it mandatory that companies register their offering with the SEC. Registration gives the SEC control over the company. All notices, articles, reports, files, and other communications relating to the company must be filed with the SEC. Once registered, the company is deemed to be offering registered securities, which are subject to the same filing, reporting, and recordkeeping requirements as those that are registered through a broker-dealer or in person.
Registration does not guarantee that the site is secure. Just because you have registered your site does not mean that your information is protected. All information passed on to a third party must be encrypted and transmitted over secure connections. In addition, there may be circumstances where an unauthorized party gains access to the company’s information, such as through hacking. Regardless, in order to ensure that the securities you are trading are delivered in a safe manner and in compliance with the Security Exchange Act, you must perform the following to protect your customers and investors:
Protect sensitive information by implementing policies and procedures that implement strict procedures and security measures. These measures should include the creation of backup plans for sensitive information. For instance, in securities, if a brokerage firm receives a customer order and fails to complete the transaction within the allotted time, then the brokerage must inform the customer and provide a full and accurate explanation as to why the transaction failed. Furthermore, in order to process securities, companies must employ procedures that take the least amount of time.
Lastly, online brokerage houses must ensure that all securities provided are in the state that they are legal in before completing the transaction. This means that companies processing securities online have to make sure that the state of the transactions are legal in so that they can process legally binding orders from clients. By implementing these security measures, you can ensure that sensitive and private information remains safe and secure.