How to Share Sensitive Information Securely within a Deal Room

For safeguarding documents with other parties, several firms use online data rooms or virtual data rooms. Are they, however, as safe as they appear? If you want to exchange information safely via the cloud, be cautious about what you buy.

What is the definition of a secure data room?

Document publishers upload PDF and Office files to a secure data room system, where they are made available to users via a link — this might be a link to a single file or a whole data room (a group of documents).

A watermark, an expiry date, and whether or not papers may be downloaded and printed are common security measures.

Systems like Digify and DocSend are examples of secure data room solutions, but there are hundreds to choose from, with some giving greater protection than others.

Data rooms are not as safe as you may believe

So you believe your records are protected in a data room? These services ‘allow corporations and outside partners to come together and share sensitive information conveniently and securely,’ according to the companies that provide them. True, effortlessly is one thing, but safely is another.

Many companies claim to have high-security credentials or use terms like “world-class security” (whatever that means), claiming that your data is stored on high-security servers and encrypted with military-grade encryption, that their systems are ISO certified and compliant with various standards, and that your data is protected by multiple backup systems. That certainly seems secure, but the true security risk is hidden behind the marketing hoopla.

If your document security system has serious flaws, the last thing you need to worry about is your data being hacked or stolen from a server. Usability is one of several challenges with secure data rooms.

So, what are they withholding from you about how safe your documents are?

What happens once you upload papers to the data room?

To begin, you must upload your unprotected files to a server in order for them to be made available in a secure data room for online viewing What happens to those papers that aren’t encrypted — are they backed up, are transient files produced, and what happens if the encryption process fails? These are all areas to be concerned about since if a data room server is hacked, your unencrypted papers may be as well.

Loopholes in a secure data room ‘security’

Users must use their browser to visit a URL and login to a portal in order to see your secure documents (or alternatively click on a link to a specific document). To download a document (which may then be viewed offline), users must be online and must enter a username and password each time they visit the system. The flaws with this strategy are discussed below.

The data rooms that aren’t so safe

A security dilemma is the capacity to safely transmit documents online while maintaining the simplicity of usage. The more simple things appear to be, the larger the real flaws.

Is it possible to keep usability while still maintaining security?

When using secure deal rooms or data rooms to store your papers, think about how secret they are and how much danger you are ready to take.

Because consumers do not need to install any software, web browser viewers are simple to use. However, users must login each time they want to read your protected papers, which requires them to remember yet another set of credentials.