Growing need for destruction
Local shredding companies say business in Central Mass. is booming eight months after a new federal law forcing businesses to shred any trash containing customers’ personal information took effect.
Called the Fair and Accurate Credit Transaction Act (FACTA), the law went into effect in June and is aimed at reducing identity theft."Our business has definitely increased as people get a better understanding of the laws," says Tom Lynch of E.L. Harvey and Sons Inc., a Westboro shredding company. "But we’re still getting some people who are not quite up to speed."
Identity theft is a major concern for customers and for businesses. Nearly 7 million people were the victims of identity theft last year, according to the Identity Theft Resource Center. Those victims spent around 600 hours each recovering from the crime and lost roughly $16,000 in potential income. And businesses lost between $40,000 and $92,000 in fraudulent charges.
Under the new law, businesses that fail to shred documents can be penalized up to $1,000.
The growth of the shredder industry with the passage of the FACTA is a national trend. The National Association of Information Destruction, a national trade group for paper-shredders, added 84 new members to its association in the last six months and is on pace to break a record set the previous year when 134 companies joined.
The market for home shredders has also grown too. Framingham-based office supplier Staples has launched its own line of home shredders (ranging in price from $39.99 to $99.99) to tap the estimated $350 million dollar a year business for shredders. Fellowes Inc., one of the country’s largest shredder manufacturers, saw its sales grow 150 percent last year.
But many businesses can have "years of paperwork that is sitting in places," says Paul J. Benoit, owner of Northeast Data Shredding in Leominster.
And that’s not to mention junk mail, hard drives, floppy disks or CD-ROMs or any of the other assorted materials that can accumulate over the years.
Of course, for many companies, the law merely formalized a procedure that they have been following for some time
"As financial institution we have a higher sensitivity to customer personal information, so shredding has been a routine process in our operation," said Bob Duquette, CFO of Bay State Savings Bank.
Bay State transfers all documents to be shredded from the bank’s six satellite branches in Worcester, Auburn and Holden to the main branch at 28 Franklin Street. There, a mobile shredder destroys the materials while a bank employee observes.
"We prefer to do on-site shredding so the material is not out of our sight at any point," Duquette says. "And we shred anything - from formal documents down to scrap paper that we might have jotted down information on during the day. We don’t want anything to be out of our control."
Benoit of Northeast Data Shredding says "I knew it was a business that had a lot of potential because of situations like Enron and people losing information to people stealing it out of dumpsters," he said. Benoit’s is a smaller outfit: one mobile shredding truck and two employees. He serves all of Worcester county and as far east as Boston, and the South Shore.
As more competition moves into the Worcester area, Benoit says ultimately the customers will win.
"When I first started there were three shredders listed in the yellow pages and now there’s something like 15," he says. "But that’s good because competition brings down the price."
Kenneth J. St. Onge can be reached at
kstonge@wbjournal.com
WBJ Web Partners
Most Recent
Most Recent
0 Comments