New Law About To Send Shredding On A Tear
New Law About To Send Shredding On A Tear
Author: Alan Wagmeister
Part of the new consumer credit law will have anyone employing even one person shredding documents.
Undated — Do you shred? If not, get ready to.
You’ve heard about shredding. You understand that it’s probably a good idea to shred any receipts that have your credit card numbers or other personal information on them to stop identity theft.
You may have seen shredders at the office or noticed bulging trash bags of thin paper strips in the dumpster when you’re walking the dog past a local business at night.
But now there’s a law with a provision going into effect this summer that says if you employ even one person – a nanny, a yard man – and you have their personal information because you’re doing the right thing and paying Social Security taxes, you have to “destroy” the information before you throw it away.
You have to shred it or burn it or pulverize it.
Or you could get sued. Or fined. Or become part of a class-action lawsuit by enraged nannies whose personal information has somehow gotten out.
Bet you didn’t know that.
The shredder industry does, and it expects sales to go on a tear.
Shredders are going to become “a household requirement as much as a washer and dryer,” says Bob Johnson, executive director of the National Association for Information Destruction (NAID), a paper-shredding industry trade group.
That’s because one provision of the Fair and Accurate Credit Transactions Act (FACTA) – the law that also says you get one free look at your credit report each year – will mean an exploding industry will get bigger.
Already, personal shredders are becoming so ubiquitous that Williams-Sonoma in its latest catalog offers its first-ever combination shredder/garbage can for your kitchen (for $229). And architect Michael Graves has designed a cool shredder for Target ($35).
InnoDesk makes handheld, battery-operated shredders for use in the car or kitchen or at your desk at work. Each weighs 1.5 poundsand costs $16.
And Fellowes, a family-owned company that invented the personal shredder in 1990, makes so many shredders that it is twice the size of its nearest competitor, says Jude Rake, president and chief operating officer.
“The reality is: People are afraid of their mail,” says Tony Lammers, president of InnoDesk of Beachwood, Ohio.
“They do really strange things to get rid of mail,” he says. “They fire up the barbecue and burn it. They use the fireplace. Or they tear up their mail in little bits and pieces and run around the house putting a little bit in this trash can and a little bit in that trash can so that it won’t all go out in the same garbage bag.”
The fastest-growing crime
They have good reason: Identity theft is the fastest-growing crime in the USA, according to the National Crime Prevention Council. About 7 million people had their identities stolen in the year ended July 2003, according to two studies done by Gartner Research and Harris Interactive.
Each will spend an average of $1,495 and 600 hours getting his or her finances straightened out, according to the Identity Theft Resource Center. And that’s not counting lawyers’ fees.
Overall, the market for shredders, including big commercial machines that handle tons of paper at a time, is about $350 million a year, says Steven Jacober, president of the School, Home and Office Products Association in Dayton, Ohio.
Revenue has been growing in the low double digits every year, he says. The main fuel now is the home and consumer market. Revenue for personal shredders has grown 20% to 25% over the past three years, Jacober says.
In fact, shredders are the fastest-growing segment of the total office products market, Rake says. “We’ve had some months where our sales have grown 70% from a year ago.”