Understanding SOC 2 Compliance in Collections
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The Importance of SOC 2 Compliance When Outsourcing Debt Recovery

Data security has taken center stage for businesses in all industries, especially those considering outsourcing critical operations like debt collection. While it’s important to partner with an agency that excels in recovering debts, they should also have the tools to safeguard sensitive customer and business information.

This is where SOC 2 (Service Organization Control 2) compliance comes in. When choosing the right outsourced debt recovery partner, you’ll want to ensure they’re SOC 2 compliant.

But what is SOC 2 compliance? How does it prove that your partner is taking the right data security precautions? Read on to find out and learn why it’s so vital to your data security strategy.

 

What is SOC 2 Compliance?

SOC 2 compliance is a framework designed to ensure service providers securely manage data to protect their clients’ privacy. It’s particularly relevant when handling finances, where the confidentiality and privacy of consumer data must be a priority.

A debt collection agency’s compliance with SOC 2 indicates they’ve demonstrated stringent controls in security, availability, processing integrity, confidentiality, and customer data privacy:

  • Security – The system is protected against unauthorized access (both physical and logical).
  • Availability – The system is available for operation and use as committed or agreed.
  • Processing integrity – System processing is complete, valid, accurate, timely, and authorized.
  • Confidentiality – Information designated as confidential is protected as committed or agreed.
  • Privacy – Personal information is collected, used, retained, disclosed, and disposed of consistent with the company’s privacy policy.

A provider can only be deemed compliant after going through a thorough audit. Essentially, compliance highlights a debt collection company’s commitment to data security and maintaining clients’ trust.

 

Evidence Collected During a SOC 2 Audit

The SOC 2 audit process is designed to be thorough. Information evaluated about an agency ranges from data security technologies to information on terminated employees.

Your business needs assurance that a collections partner can handle sensitive information appropriately and mitigate risks associated with data breaches and cyber threats. That’s why a SOC 2 audit is designed to validate stringent controls in security, availability, processing integrity, confidentiality, and privacy of customer data.

Evidence requested during an audit often includes:

  • Terminated employees’ information, including proof that their access to systems has been removed and all accounts associated with the business are disabled.
  • New hire onboarding processes, such as employee handbooks, system access controls, and background checks.
  • Risk management, including vulnerability scans, previous security assessments, and business continuity plans.
  • Incident response plans, including information on how security threats are identified and handled.
  • Data security practices, such as strong password requirements, anti-virus software, multi-factor authentication, data encryption, and confidentiality policies.
  • Change management processes for new software or systems, including code reviews, defined employee roles, and an emergency change mechanism.
  • Vendor information, including an updated list of vendors, vendor security practices, and their SOC 2 reports.
  • Regulatory compliance related to cybersecurity, including an annual policy review, company-wide security training, and penetration testing results.

Each of these areas is scrutinized by Certified Public Accountants (CPAs) or an audit firm commissioned by the AICPA. So, your business can ensure that no stone is left unturned when working with a compliant debt collection agency.

 

SOC 2 Compliance for Collections Agencies

According to Keeper Security’s 2024 Insight Report, 95% of IT leaders say that cyber attacks are becoming more sophisticated than ever. As a result, the number of data breaches has steadily increased year-over-year.

IT leaders shared the emerging attacks they’re witnessing at their organizations:

  • AI-powered attacks – 51%
  • Deepfake technology and supply chain attacks – both 36%
  • Cloud jacking – 35%
  • Internet of Things (IoT) attacks and 5G network exploits – both 34%
  • Fileless attacks – 24%

In 2023, the number of data breaches in the US increased by nearly 20% compared to 2022. With the frequency and sophistication of cyber-attacks increasing, SOC 2 compliance is key for any outsourced partner.

Outsourcing your collections process involves transferring sensitive data to a third-party service provider. This raises critical questions about how this data is handled, processed, and protected.

SOC 2 compliance assures businesses that their collections service provider operates with the highest standards of data security and management. Having a SOC 2 compliant collections agency on your side demonstrates that they have robust systems in place designed to shield sensitive data from the prying eyes of hackers.

For businesses, this demonstrates a tangible commitment to data security and ethical operations. At Radius, we recognize the importance of data security and privacy. That’s why we are proud to be a SOC 2 compliant organization.

 

Enhance Security with SOC 2 Compliant Debt Recovery Services

At Radius Global Solutions, we understand the importance of maintaining the highest standards of data protection while delivering exceptional debt recovery services. That’s why our security measures include state-of-the-art encryption, secure data storage, and restricted access controls that ensure only authorized personnel can access sensitive information.

We continuously improve our processes and systems to address emerging security challenges and ensure we are at the forefront of data protection practices. Contact us today to find out how a SOC 2 compliant partner can help achieve your collections goals while protecting sensitive data.

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