Digital Assets and Account Information: What San Diego Businesses Need to Do
As business becomes increasingly internet-based and focused on mobile and social platforms, many San Diego businesses are accumulating what are known as “digital assets.” This is good. Digital assets are online financial accounts such as Paypal, and other virtual property assets like the company website and cryptocurrencies. On the downside, as businesses move ever in the direction of paperless billing and reporting, finding and accessing these digital assets can be a significant challenge if a key employee leaves, or becomes incapacitated. As such, in today’s business environment, digital assets require special attention. Here is a to-do list to consider.
San Diego Business Law: Access to Digital Assets Like Usernames and Passcodes
By now, everyone has personally experienced the problem of “forgotten” usernames and passcodes. You registered for some service or with some website; months or years later you return — or there is now a problem — and you cannot remember your username or password. Likely, you have no idea what the security questions were or what you typed in as your answers. This is a problem we all face as individuals.
Businesses face the same problems and more since many people are potentially involved and since business assets are at issue. Here are some steps your business can take to minimize these sorts of problems:
- Audit and identify accounts and digital assets with usernames and passcodes — make a list — some of these will be obvious like the company website and financial accounts, but others will be more obscure including online registrations with utility accounts, access to governmental website — courts, county recorder, taxing authorities, etc.
- Audit periodically — only scheduling a periodic review will ensure that the relevant information remains up-to-date.
- Record on paper the relevant information — this is the key task to undertake; usernames, passcodes, accounts, websites, security questions and answers, the associated phone numbers and/or email addresses are among the relevant information; having it in writing allows for transition and maintains a record of what accounts exist.
- Avoid electronic storage of list of accounts and relevant information — see below re: security.
- Centralize the relevant information — it may be useful to have more than one location; onsite at the business and, maybe, in a safety deposit box.
- SECURE the relevant information — obviously, this sort of information must remain confidential; your company’s business may depend on it since theft of your website domain name, for example, likely leads to financial ruin; securing the information also means avoiding keeping the information in an electronic format.
- Update the information as changes are made.
- Train your employees and staff on procedures.
- Plan for adversity/transition — establish procedures for circumstances where a key employee has separated from employment suddenly or is unavailable; who has keys to the locked file cabinet?
Establishing these sorts of procedures is essential, especially for smaller and family-run business. You never want to have the situation where the boss is in the hospital and no one at the company can access the payroll accounts.
San Diego Business Law: Keep and Update a List of Digital Assets
Not only should your San Diego business keep good records on accounts, usernames, and passcodes, it is important for all businesses to keep a list — or some paper documentation — of all digital assets. This is particularly true as so much is now done without being put on paper. Again, the key task is the audit and identify.
In this regard, special attention should be paid to trade secrets and other confidential information that might be digitally stored. Old and allegedly defunct computers should, for example, be cataloged if those computers contain valuable data. Most businesses understand the need to retain paper business records; computers, disks, and other storage devices should receive the same treatment.
Contact San Diego Corporate Law
For further information, please contact Michael Leonard, Esq. of San Diego Corporate Law. Mr. Leonard has the experience to help draft and implement company policies and procedures and to help with all other types of business legal issues. Contact Mr. Leonard by email or by calling (858) 483-9200.