Risk management has taken on new meaning in its relatively short-lived history as a European company is looking to further change the way financial institutions in the U.S. view operational risk and the protection of data. Lampertz is a German-based provider of physical data and hardware security solutions, as well as technical computer accommodation systems.
What Lampertz does is create secure rooms to house data centers, known as the Modular IT Environment. These patented rooms are already in place at financial institutions across Europe, South America and Asia, and Lampertz is now tapping into the U.S. market.
The environment Lampertz creates protects IT systems, data and telecommunications equipment from environmental hazards and human threats. The fireproof, smoke and watertight environments are built using multiple steel construction and heat insulating materials for the storage of data servers and other sensitive hardware and software. The Modular IT Environment is a six-sided enclosure that can be adapted to any facility and provides its own floor, walls and ceiling system.
Frankfurt-based Dresdner Bank already has at least a dozen of the Lampertz environments in various branches with installation scheduled to begin at yet another in Istanbul in March and in a Miami branch sometime in the third quarter, says Jerry Lyons, president and ceo of U.S. operations for Lampertz. In the last five months that weve been marketing this product in the U.S. weve received over 100 requests from interested companies, notes Lyons, although he would not reveal their names. The response has been tremendous and a good portion of them represent the financial industry, such as banks and commodities exchanges, and/or services that are provided to them.
Dresdner began implementing the Modular IT Environments three years ago with installations in Poland, Denmark, Belgium, Sao Paulo and Panama. The reason we chose to do this is very simple, explains Reinhard Hille, assistant manager group organization and information technology for foreign entities with Dresdner. Were using client server technology and we store a lot of sensitive data at various locations and we have to protect this data. We needed a secure environment for this. Hille says that the losses Dresdner could incur if the data was destroyed or tampered with for even one day could easily reach up to $5 million. Other financial services clients using the IT environments include BNP Banque Nationale de Paris, Deutsche Bank, DekaBank and Banco CCF in Sao Paulo.
Lyons points to another reason why these environments have been more widespread in Europe thus far, Europe has been much more sensitive to things like terrorism, much more than in the U.S. The issues and human threats abroad were right on the surface. He adds that the latest installment of the IT environment set to begin in Instanbul was a direct result of recent events in Turkey such as the major earthquakes, which caused massive damage to the region. Although the bank also has back-up sites and disaster recovery centers, the physical security of the data at the branch has become increasingly important, explains Lyons.
The issue is Can I do business without such security and what is the risk if I loose my confidential customer data? and the point isnt how much we have to spend for such an environment, but what I have to spend if I lose that data, adds Hille.
In terms of other physical security options, Lyons claims that the Lampertz environment is superior as it protects against all aspects of physical risk, not simply fire and water. From a physical perspective, many operations have had to accept conventional construction like a two-hour (fire protection) rated wall. They assume that protects them, and it does protect against the flames, theoretically, but it doesnt protect against the bi-products such as smoke, humidity, gas and even the sprinkler systems, says Lyons.
Most of the operational risk attention has been paid to the technical and logical side of security such as power outages, viruses, hackers, etc, but were protecting against what we call the human and environmental threats which are becoming more and more important, notes Lyons. While Lampertzs U.S. operations are still in the infancy stage, Lyons predicts that the secure IT environments will catch on quickly for added protection in the operational risk plans of institutions across the country.