The old IT maxim “Garbage In, Garbage Out” should now read “Garbage In, Danger Out,” in light of the expanding list of compliance issues facing corporations today. From Sarbanes Oxley and proposed SEC Mutual Funds regulations, to anti-terrorist Patriot Act/OFAC rules, companies are on guard and on edge. As organizations slowly begin to navigate the compliance obstacle course, many are using their IT departments as the first line of defense in preventing inadvertent missteps that run afoul of the law.

Considering the costly tangible and intangible penalties written into these compliance laws, “Garbage Out” has become a real and present danger rather than just an occasional “cost of doing business.” If data management practices do not produce accurate evidence of compliance – or ensure that systems will stay within the bounds of compliance – companies can face hundreds of thousands of dollars in fines, and suffer irreversible credibility losses from bad publicity that can seriously erode customer trust and jeopardize future business.

For example, the Do Not Call Registry is a regulation put in place by the U.S. Federal Trade Commission to help consumers manage the barrage of telemarketing calls. If a company contacts an individual on the Do Not Call list, penalties ensue. The national list, which now contains more than 60 million names and numbers, carries a hefty fine of $11,000 per infraction. The government threatened to start fining a California mortgage company that amount for each of several thousand calls made to numbers registered on the Do Not Call list. At that rate, violating the law would put most telemarketing companies right out of business.

Beyond the financial penalties, most savvy telemarketers and retailers realize that those 60 million households registered on the Do Not Call Registry list have voiced their opinions about a “quality of life” issue. Such a huge number equates to a public mandate telemarketers simply cannot ignore. If word gets out that their practices are violating the Do Not Call regulation, their brand and reputation will suffer in the court of public opinion, even if the government only issues a warning.

To stay on the correct side of these laws, corporations must have control over relevant data throughout their organizations. This includes all target call lists from every division for Do Not Call compliance, and all transaction records for Patriot Act/OFAC compliance. Not only must the organizations have control over the data, but they also must ensure that the data is accurate and kept up to date.