Consumer fraud and identity theft is one of the fastest growing crimes in the U.S. today that can affect every one of us. In 2004 alone, Consumer Sentinel, the complaint database developed and maintained by the FTC, received over 635,000 consumer fraud and identity theft complaints. Consumers reported losses from fraud of more than $547 million. A great deal of these crimes could have been prevented if the confidential information had been destroyed before it was discarded. The most commonly used method to destroy unwanted sensitive information is to use a shredder to shred the source of information such as paper or CD.
The government is continuously placing strict requirements on various industries regarding the disposal and protection of confidential information. Most of the employers, even with only one employee, are now required to properly dispose sensitive or consumer information. Some of the legislations related to paper shredders that may apply to your business include:
Due to the rising increase in Identity Theft every year, Congress has enacted the Fair and Accurate Credit Transactions Act of 2003 (FACTA). The disposal portion of this law will take effect June 1, 2005 and require all employers to properly destroy any information derived from a consumer credit report before it is discarded. After this time you can be held legally responsible for any fraud that results from your information. This new law affects all business owners even if they only employ one person. The standard for disposal is flexible but the use of a paper shredder to shred sensitive consumer information will become the most common method to fulfill this requirement.
The Health Insurance Portability and Accountability Act of 1996 (HIPAA) contains a privacy rule that affects healthcare organizations. Compliance was mandated by April 2003. This Federal Law "establishes standards for many healthcare entities including, but not limited to health plans, healthcare clearinghouses, and healthcare providers including hospitals and general practitioners". These providers are required to "protect the privacy of certain individually identifiable health information". Basically, this act is stating that any Patient Health Information that contain medical information, medical history, social security numbers, ID numbers, credit card numbers, health insurance or any other personal information, must be destroyed in such a way that it becomes unreadable. The most popular and effective way to do this is document shredding with the help of a paper shredder.
The Gramm-Leach-Bliley Act (GLBA) affects all financial institutions, including banks, credit unions, securities brokers, real estate appraisers, insurance companies, automobile leasing companies, companies that operate travel agencies in connection with financial services, and any other entity that is "significantly involved in financial activities". Those affected by this Act need to develop a comprehensive written information security plan and annually disclose to their customer base a detailed disclosure policy that explains how personal confidential information will be used and how they plan to safely destroy it. The GLBA took effect on 11-12-2000; full compliance was mandatory by 07-01-2001. Most consumers prefer the use of paper shredders for shredding personal confidential information .
In California, Assembly Bill 2246 requires any business to take all reasonable steps to destroy a customer's record within its custody or control containing personal information which is no longer to be retained by the business by shredding , erasing, or otherwise modifying the personal information in those records to make it unreadable or undecipherable through any means. Again, the use of a sophisticated paper shredder to shred such information is the most convenient way of complying with this regulation.
In the aftermath of 9/11 (September 11, 2001) the government and military decided the current standards they used for shredding needed to be updated. A new more stringent NSA/CSS requirement for shredding "top secret" documents was introduced. As good as the paper shredders were (sometimes referred to as "Level 5" paper shredders), the manufacturers were forced to redesign their paper shredders to reduce shred size further. The new paper shredders (often called "high security" paper shredders) are now commercially available by manufacturers such as Destroyit Shredders and Dahle Paper Shredders - compliance was mandated in October 2003.

Even if none of the above regulations apply to your business, please be aware that courts have ruled several times (including the decision on May 17, 1988 by the United States Supreme Court) that trash is not confidential. Anyone can rummage through your trash and keep what they find useful - customer lists, marketing plans, product information, personal and financial information that is sufficient for any sort of identity theft or consumer fraud. The only way you can avoid such incidents is by using a good paper shredder to destroy any sensitive information before trashing it.
The two most reliable paper shredder brands that have captured very high market share in office, departmental and industrial paper shredders are Destroyit Shredders and Dahle Shredders.