Five Forensic Compliance Challenges Amid The Pandemic

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Five Forensic Compliance Challenges Amid The Pandemic

The pandemic brought things to a standstill, with many businesses having to shut down their operations altogether. This led to companies devising new strategies to stay relevant in the market and continue their operations to minimise losses. Working from home was a game changer for most. However, this decentralisation of the working environment has resulted in new forensic compliance challenges.

The Compliance Dilemma

The major shift in workplace culture has impacted companies’ compliance norms. With the majority of employees working from home, opportunities for not complying with policies relating to device and data usage have increased. Further, employees could use personal devices to exchange information or use company assets for personal work. Preservation and collection of electronically stored information is also a challenge. We list below the top five forensic compliance challenges that have arisen amid this crisis.

1. Document Retention

With the fine distinction between home and the workplace in the working-from-home environment, it has become vital to review organisations’ document retention policies and understand how they apply to company data stored on personal devices.

Since the data is stored outside the company’s standard information systems, it may not be subject to the company’s document retention policies. This becomes critical when it comes to handling litigation holds. A company needs to ensure that employees do not save project-related documents on personal computing devices.

2. Bring-Your-Own-Device (BYOD) Records

Many corporations allow their employees to work using their own computing devices, popularly known as the BYOD format. Maintaining a log of BYOD systems could be a challenge when employees are working from home or locations other than the office, but it is vital that proper records be maintained.

One of the primary reasons this is extremely important is that it enables a company to search these devices in the event of a mishap such as data theft. It gives the company the flexibility to have jurisdiction over the use of personal assets and monitor such use in the event of suspicious activity.

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3. Establishing Corporate Compliance Policies

Establishing strict corporate compliance policies related to communication and exchanging information can be a major challenge for organisations with a remote work culture. Monitoring official communication on different channels can be a daunting task.

They would need to formulate strict corporate guidelines and policies relating to employee communication on channels such as Zoom, Slack, Microsoft Teams and Google Meet. Not having a robust policy in place to govern such communication could hamper the work culture.

4. Fraud Detection

This is one of the main compliance challenges in the current environment, especially in the financial sector. Amid the prevailing uncertainty, the rate of occurrence of fraudulent activity has grown significantly. Also, most of such cases relate to employees, bookkeeping, taking over of accounts, security and credit.

Cybercriminals are even using the dark web to sell fake cheques and redeposit them many times over. Financial investigation with a high level of coordination is needed to detect such fraudulent activity. This is difficult to ensure in a remote-workplace setting.

5. Insider Trading 

Insider trading has been a major forensic challenge for regulatory bodies. It refers to the practice of using confidential information relating to stocks for personal financial gain. With the remote work culture, it is hard to monitor the exchange of information between employees and individuals both within and outside the organisation.

The high fluctuations in share prices amid the crisis prove the level of insider trading taking place. The US Securities & Exchange Commission recorded a 71% increase in tips and complaints from March 2020 to September 2020. Financial corporations should have strict policies in place governing communication of employees working in this sector.

Conclusion

Forensic compliance challenges are more difficult to overcome when the majority of the workforce is working remotely. Having strict corporate compliance policies and guidelines in place regarding the use of company assets and data is, therefore, a must.

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