The Hidden Risks of Overseas Transcription Services

For many professionals, hiring a transcription service that utilizes low-priced freelance workers from around the world seems like a cost-effective option—until quality issues start appearing and people start asking questions about security, confidentiality, and compliance.

While transcription companies that utilize global freelance workers may promise fast turnaround and low prices, there are serious risks you should be aware of before trusting them with your important work - especially if it is confidential. 

Let’s explore the risks and how to identify the companies that introduce them.

1. Data Security and Privacy Concerns

Transcription companies that outsource U.S.-based data to freelance “gig” workers outside the U.S. introduce significant security risks, including:

⚠️  Weaker data protection laws – Workers outside the U.S. do not follow the same data privacy regulations the U.S. does. 
⚠️  Your files could be shared by unlimited third parties.
⚠️  No accountability – If a data breach happens overseas, the workers responsible cannot be held accountable since they do not answer to U.S. law (if they can even be found).

❗ Re-recording of files: While some transcription companies claim that workers cannot download the files from their system, savvy "gig workers" know how to re-record files from streaming audio on their computers, thereby giving them their own copy of the file to control in their audio transcription player and AI programs.

🔹 A 2018 study by the Ponemon Institute found that 59% of companies experienced a data breach caused by a third-party vendor, highlighting the risks of outsourcing sensitive information (Verizon: source). While the study does not specifically state where these vendors are based, many operate outside the U.S., where weaker data protection regulations increase security vulnerabilities.

2. Quality and Accuracy Issues

Language barriers, cultural differences, and insufficient training and oversight severely impact transcription quality.

• Industry-specific terminology is often misunderstood – This is especially problematic in business, health sciences, law enforcement, and academic research transcription, where minor mistakes could lead to major errors in conclusions.
• Inconsistent quality—Using workers from unlimited countries without collaboration on work leads to inconsistencies in formatting and subject-matter knowledge.
• Heavy reliance on AI transcription—Global gig workers often use AI to generate their transcriptions, and they lack the language skills to spot errors. 

If your work is in the U.S. and accuracy and consistency are priorities, a transcription company that utilizes a global network of freelance workers can compromise the integrity of your work and lead to costly mistakes.

3. Legal and Compliance Risks With Patient Data

Outsourcing transcription overseas can create significant legal complications, especially for professionals who handle protected healthcare information (PHI), where the data is governed by HIPAA law (Health Insurance Portability and Accountability Act).

🔹 The Risk: If your transcription provider outsources U.S. patient data outside the U.S., its safety is in the hands of people who do not answer to HIPAA law. 

4. How to Identify a Transcription Company That Sends Work Overseas

Many transcription companies don’t openly disclose that they send work to global freelance workers. Here’s how to spot the warning signs before hiring a provider:

📌 Check The Careers Page on their Website

🔎 What to Look For:

• Does the page talk about “working from anywhere?”
• Does the job application include a field for “Country”?

If the company only hires U.S.-based transcribers, it will say so on the website. 

Some global transcription network companies “bury” the Transcription Careers page (requiring multiple links to find it) so the average visitor will not see it - but hungry gig workers know how to discover it.

📌 Red Flag: If they hire transcriptionists worldwide, your files may be sent worldwide.

📌 Review Their About & Contact Us Pages

🔎 What to Look For:

• Do they list a U.S. business address?
• Do they mention offices in other countries?

📌 Red Flag: If there’s no clear U.S. address, and you cannot find a U.S. office via Google search, they are likely based outside the U.S.

📌 Use Google to Find Insider Information

🔎 What to Look For:

• Search “working for [company name]” to find online discussions about the company from current or past workers.
• Look for worker complaints or mentions of offshore hiring.

📌 Red Flag: If multiple reviews mention overseas workpools, low pay, or global freelancer hiring, the transcription is done outside the U.S.

5. The Advantage of U.S.-Based Transcriptionists

Choosing a 100% U.S.-based transcription provider ensures:

✔ Stronger data security – Files are protected under U.S. privacy laws.
✔ Higher accuracy & accountability – Native English-speaking transcriptionists understand U.S-based slang, references, and industry terminology.
✔ Full legal protection – You retain legal recourse if security or confidentiality is breached.

Final Thoughts: Global Transcription Networks Are a Gamble You Don’t Need to Take

At first glance, a global freelance transcription company may seem cheaper—but the risks far outweigh the savings.

• Data breaches.
• Compliance violations.
• Inaccurate transcriptions.

🔹 Next Steps: Before hiring a transcription provider, do your research. If they can’t guarantee U.S.-based transcriptionists, your data is not fully protected. And the quality will be compromised.

See how to properly vet a secure, U.S.-based transcription provider →