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How Data Protection Laws Impact IT Hardware Recycling

Learn how laws like FACTA, GLBA, and HIPAA require secure data destruction when retiring old IT assets to avoid data breaches.
Posted in Recycling Tips

With data breaches constantly in the news, proper handling of sensitive data is crucial when it's time to retire old computers, smartphones, servers, and other IT equipment. Various laws and industry standards strictly regulate how personal and financial information must be secured before disposing of electronic devices. Failing to fully erase data on aging hardware can lead to crippling fines and seriously tarnish a company's reputation.

Specialized electronics recycling companies are invaluable for helping organizations retire IT assets while remaining compliant with regulations. Here, we will examine the key standards that require watertight data destruction when equipment changes hands. We'll also outline the comprehensive recycling process professional asset disposal firms use to protect sensitive information.

Relevant Laws and Standards Mandating Secure Data Destruction

Below, we discuss various federal and industry regulations that lay out stringent guidelines for handling private data as technology is retired.


The Fair and Accurate Credit Transactions Act aims to minimize identity theft. It requires proper disposal of any records containing private financial data. For retiring IT hardware, this involves degaussing hard drives, wiping solid-state media, or physically shredding devices.


List of data protection laws.

The Gramm-Leach-Bliley Act applies to financial institutions. It mandates they maintain the security and confidentiality of customer records. Proper destruction of data-bearing devices is essential before disposing of servers, workstations, and mobile devices.


The Payment Card Industry Data Security Standard guards cardholder data. It demands secure wiping and/or destruction of any hardware involved in processing payments prior to disposal.


The Federal Information Security Modernization Act protects information handled by government agencies and related contractors. It requires securely destroying data stored on hardware that processed federal records before disposal.


The Health Insurance Portability and Accountability Act is designed to safeguard the confidentiality, integrity, and availability of protected health information (PHI) when disposing of it. This includes hard drives containing PHI. It requires thorough data cleansing from devices like computers in healthcare facilities before retirement.


The Health Information Technology for Economic and Clinical Health Act, passed in 2009, expanded HIPAA safeguards for electronic medical records. HITECH extended privacy and security rules around protected health information to business associates of covered entities. It also mandated data breach notification while increasing consequences for noncompliance. Through hefty fines and auditing authority, HITECH put more teeth into HIPAA. It emphasizes the importance of proper data security when retiring hardware containing patient e-records.

The Secure IT Asset Recycling Process

Reputable information destruction and electronics recycling companies follow standardized procedures for retiring IT hardware without risk of data leakage. Here are some key steps:

  1. Receive and Catalog Aging Equipment: The disposal firm inventories all devices being decommissioned, noting any that may contain sensitive data.

  2. Remove and Destroy Hard Drives: Drives are removed and shredded or erased using specialized tools.

  3. Wipe Smartphones, Tablets, etc.: Software ensures all data is wiped from phones, tablets, and flash-based media.

  4. Physically Destroy Equipment: For IT assets without resale value, or if the client requests equipment destruction, devices are shredded to render them unrecoverable.

  5. Provide Certificate of Destruction: Once complete, the electronics recycling company supplies a certificate confirming secure data destruction.

While these are the responsibilities of data destruction companies, you should also be sure to keep records of your data disposal procedures, including the methods you use to dispose of hard drives and other electronic media containing consumer information. These records can help you demonstrate compliance with any relevant laws or standards.

Choosing the Right Electronics Recycling Company for Data Security

Choosing the wrong IT asset disposition company can turn into a legal and PR nightmare. When hiring a data disposal company, make sure they are certified by a reputable organization, such as the National Association for Information Destruction (NAID). NAID certified companies adhere to stringent procedures for destroying data on paper records, hard drives, smartphones, etc. before disposal. They follow chain-of-custody practices to track assets slated for destruction, and must pass regular audits to ensure they comply with all policies.

NAID provides different certification levels based on the rigor of destruction processes. Higher levels like NAID AAA certification validate the use of advanced techniques to render data unrecoverable. Because of this, many laws and regulations like HIPAA either recommend or mandate NAID certification for destruction firms.

The Benefits of Proper Retirement of IT Assets

Carefully following data security protocols when retiring organizational IT equipment provides multiple advantages:

  • Maintains compliance with laws like HIPAA and GLBA, avoiding violations.

  • Safeguards customers by preventing identity theft and data misuse.

  • Allows technology upgrades without fear of data breaches.

  • It's environmentally responsible compared to landfilling devices.

  • Protects brand reputation by ensuring defensible data handling.

As you can see, various regulations mandate watertight control of personal and financial data when organizations retire IT assets. Partnering with experienced electronics recycling firms to properly handle old equipment maintains legal compliance and customer trust.


— PC Disposal has been helping companies properly dispose of IT equipment since 1998. As a NAID AAA Certified responsible recycler, we are the first ITAD firm to offer a $1,000,000 service guarantee and secure transport cages for equipment holding sensitive data. Contact us to learn more about our services.

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