Minimizing Legal and Regulatory Risks with Digital Signatures – Defining the Risk and Dangers

 PART 1 - Risk is a topic every organization deals with, and with our most recent blog entries here at SIGNiX, we’ve been discussing how digital signature solutions can help to minimize those risks. However, one aspect of risk mitigation that gets brought up most frequently when we discuss electronic signatures with clients is that of legal and regulatory risk. Our customers and partners ask:

“Are e-signatures legal?”

“How can I be confident these digital signatures will hold up in court?”

“Can digital signatures help my organization become more compliant with this or that industry regulation (i.e. HIPAA, GLBA, SOX, etc)?”

“What aspects of an electronic signature product should I be looking for if I’m concerned about assurance?”

What do we mean by legal and regulatory risk? It’s defined in a number of ways:

• The risk of contracts and documents not being accepted due to something lacking in the way they’ve been signed.
• Documents being questioned during their lifetime due to questions regarding their integrity or source.
• Contracts being cancelled by a court or other body due to concerns about whether a party signed or how they signed.

There are significant dangers to being exposed to these kinds of risks that far exceed those we’ve discussed earlier. They include:

• Contracts not being upheld
• Lost revenues
• Guilty verdicts both in court and the ‘court of public opinion’
• Investigations and audits
• Brand damage
• Fees and damage payments
• …and the list goes on!

In the next few blog posts in our continuing Digital Signature ROI series, we’ll be covering the following topics, all of which will help to address these risks and answer the questions above:

• Are e-signatures legal? – What gives them standing? What about regulatory compliance?
• What to look for in an electronic signature solution – What aspects of a product are most important when judging the assurance provided by an electronic signature?
• How can digital signatures minimize legal risk? – We’ll look specifically at how digital signature solutions, like those at SIGNiX, can minimize and all but eliminate many of the risk factors.

Stay tuned here to the SIGNiX blog for these follow-up posts.