Symantec Indian Call Center Employee Selling Credit Card Details (Shocking)!

A story of an undercover investigation by the BBC shows how dishonest employees at call centers — who collect plastic payment card details on clients — might be making a little extra pocket change by selling them.

The focus of the BBC story is centered on an Indian call center employee for Symantec Security Corporation stealing payment card information. It is also centered on UK customers, which is understandable given it is the BBC, but the reality is that information is stolen then sold from countries all over the world.

Payment card details are handled by telephone at call centers in a lot of places and the calls come from all over, too. A lot of companies have different tiers (levels of personnel) handling calls, depending on the difficulty or nature of the call. At a lot of major companies, these tiers are located in different centers, which are in different countries. Any call might start in one country and, given the nature of the call, it could be transferred to another center located in another country. Given this, payment card information can be sent and then illicitly recorded over a fairly wide geographical area.

Besides that, dishonest employees are caught on a regular basis in a lot of different places. They don't all necessarily reside in India and call centers there are not the only place payment card information can be compromised. In fact, payment card information can be compromised anywhere (not just call centers) where they are used at a point of sale.

Information crooks are recruited and some think even planted anywhere financial information can be stolen. Even if they are not, payment card details are being bartered in forums on the Internet. It probably wouldn't be very hard to find a place to sell credit/debit card information when all it takes to do it is a click of a mouse.

The BBC story, which aired on video, chronicles an investigative effort by their reporters on the streets of Delhi. In the segment, it shows reporters making contact with the underground broker, who offers them payment card details from "all over the world" for $10-$12, each. It then shows a buy being made and money changing hands.

When the information was checked, it revealed that only one in seven card numbers were actually usable. They were able to trace some of the good numbers to a call center handling Symantec (Norton) products. The story stated that there has only been one successful prosecution in India for this type of crime and that it netted a non-custodial sentence. It also stated that the laws regarding the protection of data are not as stringent as they are in some places. The story mentions that Symantec's official comment was that it was an isolated incident and that the employee was removed.

Since one to seven card details turned out to be real, I guess we can assume the underground broker wasn't being completely honest. I've also seen reports of credit card details being sold for a lot less and you don't have to travel to India to find them.

In November, Symantec — the point of compromise in the story — issued a report on the underground economy, which focused on this very subject. "Credit cards are also typically sold in bulk, with lot sizes from as few as 50 credit cards to as many as 2,000. Common bulk amounts and rates observed by Symantec during this reporting period were 50 credit cards for $40 ($0.80 each), 200 credit cards for $150 ($0.75 each), and 2,000 credit cards for $200 ($0.10 each)," according to the report.

If this report is anywhere near accurate and the BBC was buying card details at $10-$12 each — if only one to seven was good in the Delhi exchange — the BBC was getting ripped off!

According to the 68-page report by Symantec, these details can be bought anywhere that has an Internet connection. Counterfeit instruments (ready to use) are often sent through the mail, too. The information is sold via IRC (Internet relay chat) channels in forums designed to market stolen financial information. Although credit/debit card details seem to dominate the scene, a lot of other information is sold that can be used to commit financial crimes and identity theft in these forums, too.

If you don't want to believe the Symantec report, the FBI took down one of these forums not very long ago. This forum known as Dark Market was responsible for about $70 million in fraud, worldwide. My best guess is that the information in the report is pretty accurate.

Although dishonest insiders are the cause of a portion of it, we should remember that hackers breaking into business systems, phishing, malicious software and even the trash can be sources of stolen information. The places targeted for information can be merchants, restaurants, goverment organizations, charity organizations, universities, medical facilities or anywhere payment card information is used at a point of sale.

Keeping up with all the points of compromise is difficult, but one place that attempts to is the DataLossDB site. Please note that the unknown data breaches are the most lucrative for the criminals behind this activity. Once a breach is discovered, measures are enacted to disable the stolen data.

It can be extremely difficult, if not impossible, to identify the point of compromise in most individual cases. The reason for this is there are too many different places where information might have been stolen from.

Maybe that's the problem, or we are storing and transmitting too much information all over the place? Since everyone is making money by transmitting information, I doubt this practice is going to stop anytime soon. So far as outsourcing, I doubt this is going to stop in the near term, either. Companies save a lot of payroll by outsourcing jobs. Payroll is a big expense for corporations and cutting payroll seems to be in vogue these days.

Nothing is going to change until laws are passed that force everyone making money from this information start doing the right things. This includes laws that prohibit people from being irresponsible (my opinion) to laws that punch the criminals stealing the information where it hurts.

Until then, the rest of us will have to batten down the hatches and weather the storm. I highly recommend making sure your information is protected as well as it can be (there are no guarantees) by protecting your own electronic transmissions. Monitoring financial activity — from your financial statements to information on your credit report and the Internet — is a good idea, too. Of course, while doing this, you need to ensure your electronic transmissions are protected by a reliable vendor and that you aren't paying for protection that you could get for free. Sadly enough, everyone claiming they can protect you isn't necessarily being completely honest, either.

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Crimes Against Businesses Contribute to Job Losses

Organized retail crime costs retailers billions of dollars. In an era, where retailers are closing stores or going completely out of business, it's logical to assume that organized retail crime is a contributing factor to retailers shutting their doors and people losing their jobs. With the sour economy inspiring more and more theft and fraud, it is becoming more critical than ever before for companies to control their losses in their struggle to remain viable.

When retailers lose money to theft, the end result can be (assuming they don't go bankrupt) that jobs are cut. Payroll is normally the largest and most controllable expense in any business. When businesses start to show negative earnings — like a lot of them are right now — payroll is normally the first place they look to cut when trying to avoid shutting their doors.

In an effort to fight what experts say is a $30 billion a year organized retail crime issue, the National Retail Federation is welcoming legislation being introduced to give them more tools to fight this problem. Yesterday, three bills were introduced in Congress to assist retailers and law enforcement in this effort.

The three bills introduced are "the Combating Organized Retail Crime Act of 2009, sponsored by Senate Majority Whip Richard J. Durbin, D-Ill.; the Organized Retail Crime Act of 2009, sponsored by Representative Brad Ellsworth, D-Ind.; and the E-Fencing Enforcement Act of 2009, sponsored by House Judiciary Committee Crime, Terrorism and Homeland Security Subcommittee Chairman Bobby Scott, D-Va. The measures are similar to legislation first introduced last summer" according to the press release and podcast on this matter by the National Retail Federation.

In case you are unfamiliar with "Organized Retail Crime," it involves organized retail theft activity for profit. Once the merchandise is stolen, it is fenced (sold) to get a cash value out of it. Traditionally, this merchandise was sold at flea markets/dishonest retailers, but more and more often nowadays, retail crime rings are turning to auction sites to unload their stolen goods.

The reason for this is if they sell it on an auction site, they make a lot more money than in the more traditional fencing venues. Experts believe they net 70 percent of the retail value by selling their stolen wares on an auction site versus the 30 percent of retail value they receive in more traditional fencing venues.

Another possible factor contributing the problem is that consumers — who are operating with ever-decreasing personal budgets — are flocking to these sites to stretch their buying dollars. Without knowing it, they might be adding fuel to the fire and unknowingly buying this stolen merchandise.

Even if the retailer can prove that merchandise on an auction site is stolen, it can be extremely difficult for them to get the site to cooperate in going after the criminals selling it. Due to a lot of red-tape imposed by these sites to release information, it requires a lot of time/effort to get the site to cooperate in an investigation. Because of this, the crooks are normally long gone before any effective investigative action is taken.

Another phenomenon called phishing makes the activity even more anonymous/hard to track on auction sites. Phishing is where a person (user) is tricked into giving up their credentials to an account. For years, eBay and PayPal have ranked as some of the most phished brands out there. Criminals use this information to take over an account and commit fraud using someone else's selling account. When investigating auction fraud, time is of the essence, otherwise the trail is often too cold to track. The crooks use one of these accounts for a short period of time and then move on to another phished account to avoid detection.

Organized retail crime is also taking advantage of the identity theft/financial crimes phenomenon and working with the hacking element that has been attacking the financial industry. Counterfeit payment cards (credit/debit), checks and identification are all being used to electronically boost merchandise and walk right out the store with it. In the TJX data breach — which was the largest hack of financial data to date — a group was caught using cloned payment cards to buy $8 million worth gift cards from Walmart. In the more recent data breach at Heartland Payment Systems — which looks like it might surpass TJX in the amount of data stolen — the only arrests made thus far were a group using the stolen data to clone gift cards. Since gift cards are redeemed at retailers, this is yet another example of how the financial hackers and organized retail crime types are working together. To me, this is evidence that organized retail crime is becoming more sophisticated in their theft techniques, which will likely make this problem get even worse than it already is.

The three bills being introduced will force auction sites to cooperate with retailers and law enforcement, define organized criminal activity as a federal offense and establish stricter sentencing guidelines for criminals convicted of organized retail crime. Too frequently, under current laws, criminals involved in this activity are treated like petty thieves and get a slap on this wrist when they are caught. Last, but not least, it will hold auction sites more accountable for the sale of stolen merchandise if it could have been prevented.

Besides fencing, there is a lot of other fraud on auction sites that isn't necessarily tied in to fencing and victimizes auction customers/sellers, more personally. Legitimate e-commerce sellers are frequently ripped off with bogus financial instruments. Buyers are also defrauded in a wide variety of scams on these sites. Like the major retail types, who are behind this legislation, the more ordinary victims are often hung out to dry when they try to get any assistance from the auction sites. There is little doubt (my opinion) that auction sites need to clean up all the fraud that occurs on them. While they do provide value and a fun way to buy things, there have been too many innocent people victimized on them.

While this legislation primarily focuses on fencing, it's a start in the right direction. Perhaps other groups should join in and support this legislation, which if passed, will likely set some needed legal precedents. It will also make it a little harder for the criminally inclined to operate on auction sites.

Supporting this legislation makes a lot of sense for a lot of different reasons. These are not victimless crimes and the consequences are being felt by innocent consumers and businesses.

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The $9 Million Electronic Robbery at RBS WorldPay

With the Heartland Data Breach still fresh in the news, word of a $9 million heist using data from another payment card processor (RBS WorldPay) has hit the air waves. RBS WorldPay reported in December that their payroll card system was hacked and 1.5 million financial and 1.1 million personal records were compromised. Payroll cards are used by employers to pay their employees by loading their pay onto a debit card.

A Fox News investigation has now revealed that on November 8th, a coordinated attack netted $9 million using cloned cards in 49 cities, worldwide. The attack occurred all over the United States, Montreal, Moscow, and Hong Kong in about 30 minutes.

Another scary aspect to this attack was that the hacker was able to remove the daily withdrawal limits of the cloned cards. According to the Washington Post, 100 cards were used and fake deposits were used to refuel the balance on the cards. Large withdrawals were then made again and again on the cloned cards. Please note this represents that a very small percentage of the total cards compromised were used in scheme. No information was available on how they refueled the accounts.

I've seen accounts refueled using bogus checks, however in this instance, I would suspect it occurred in a more electronic manner. This leads me to believe we will see more disclosures regarding this case as time goes on.

According to official reports, there are no primary suspects in the case. Photographs of some of "lower level soldiers" used to withdraw the money have been released in the hope that (if caught) they will provide information on the people, who provided them with the cloned cards. Unfortunately, with the anonymous nature of the Internet, coupled with the fact that chat-rooms are often used to facilitate the distribution of stolen data, the lower level soldiers might not know the identities of the main players, themselves.



In the recent Heartland breach, it was disclosed that they met PCI DSS (Payment Card Industry Data Security Standards). According to Visa's list of PCI DSS certified vendors, "RBS Lynk" (Royal Bank of Scotland) is certified. PCI DSS standards are the payment card industry's solution to protecting their data from being misused.

I also discovered that RBS World Pay and TrustWave put out a press release in 2007 announcing they were providing level 3 and level 4 merchants with a specialized data security service to identify their risks and vulnerabilities. The idea behind this service is to help these merchants become PCI DSS compliant.

Interestingly enough, TrustWave also certified Heartland in 2008, according to the article I read in Dark Reading.

PCI DSS has been criticized as being expensive for merchants and now we are seeing it compromised, too. The sad thing is that despite a lot of money being shelled out to become PCI DSS compliant, the people shelling it out seem to be just as vulnerable as they were before. In fact, someone might conclude that PCI DSS is giving everyone a faux sense of security (opinion).

As usual, in these cases, a class action law suit has been filed against RBS WorldPay. WorldPay has also announced the cardholders will not be held liable for the charges, according to the page on their site about this matter.

Thus far, according to all the sources I read, no identity theft has occurred. My guess is that because the 1.1 million people compromised are monitoring their credit, none will occur in the short-term. In most of the many breaches I've read about, very little of the information was used after the breach was disclosed. If you think about it, this makes sense because measures have been taken to make the information useless to criminals.

To close, I would like to add another thought. The fact that payroll information — which included personal information — was hacked might point to another example of how storing too much personal information in too many places is the root cause of the problem.

There has been a push to put everything from payroll to government benefits on payment cards. When this occurs, personal information as well as the financial data used to produce the debit card accounts is stored to process the transactions. Since employers (and the government) use vendors (card issuers) to accomplish this task, this means we have sensitive information being transferred to third parties. It wouldn't surprise me if these third parties transfer the information somewhere else when they outsource it, all over again.

Perhaps, what is needed is a common sense solution to the problem. As long as we keep sending information all over the place, it creates too many points where it can be compromised. The bottom line to all this is we appear to be making it too easy for criminals to take advantage of the situation.

The costs are getting out of control, too. Although I've never seen any information on how much of this is going on, the Washington Post quoted a source from the security industry (Ori Eisen, 41st Parameter) as stating $50 million was lost in one month in New York City alone last year.

I wonder if any of our bail-out (taxpayer) money is being used to cover these losses. Although, I can't say for sure, the people it was given to can't seem to say where it has gone, either. Granted, it might be a long shot, but the money had to be given to cover losses caused by people who were a little too greedy in the first place. We need to wake up and realize that there is no free lunch and the costs of all these types of scenarios are passed to all of us when history is written.

There is no such thing as zero fraud liability!

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Increase in Scams Attributed to Economy

I just finished reading an interesting article in the Wall Street Journal by M. P. McQueen, which suggests that the bear market is creating a bull market for fraudsters. According to the numerous experts cited in the article, the reason for this is economic gloom and doom with a healthy dose of anxiety.

This shouldn't be surprising because gloom, doom, and anxiety make effective social engineering tools that can be used to part people and businesses from their money.

The article references phishing expeditions that lead to fake Web sites — which often spoof a financial institution or government entity — and entice people into giving up enough of their personal details to drain their financial resources. It also mentions that some of these sites leave behind malicious software on a person's machine, which steal all these details automatically.
Also mentioned is the use of VoIP (Voice over Internet Protocol), caller-ID spoofing and cell phone technology to mount texting and vishing attacks. Vishing is merely another method of tricking people to give up personal and financial information via the telephone. In these attacks, the caller ID is spoofed to make it appear as if it is coming from a legitimate institution.

Apparently telephone technology is being used to commit other types of crimes, too. Many of our 911 centers cannot identify spoofed calls coming from computers using VoIP technology. This has led to S.W.A.T. teams being tricked into deploying in full battle gear to residential neighborhoods when no emergency existed. Of course, businesses use the same technology to trick people who have caller ID into picking up their telephones. You can even buy a card to do this at will from any telephone right over the Web.

It sometimes amazes me how much irresponsible technology there is out there, which is being sold legally. There are even Web sites, with disclaimers, that specialize in making this technology available to the general public. Of course, there are also complete DIY (do-it-yourself) phishing kits being sold over the Internet. Some of these even come with tech support. The phishing kits are illegal, but can be found for sale in chat rooms if you know where to look for them. Sadly, the truth is that these chat rooms aren't very hard to find. The fine line between legitimate enterprise and scams is often a little blurry.

The WSJ article quotes a lot of experts, including Gartner, the FBI and the National White Collar Crime Center, who all seem to agree that scams are on the rise. An interesting phenomenon called out were small fraud charges being found on accounts. I guess taking small amounts, which might be mistaken for bank fees, is a good way to stay under the radar. A lot of people don't realize how many small fees are being charged to their account and it can be quite confusing at times. I guess the crooks are trying to make themselves look like bankers (speculation) and it's probably a good time for all of us to review our statements, carefully.

Speaking of fees, which are used as revenue streams by a lot of businesses, the WSJ put out another article this entitled, "In the Fight Against Bill Creep, Every Extra Fee Is the Enemy." Besides being on the look out for cyber scammers, this article points out other reasons it is smart to review our financial statements with a keen eye these days.

Another notable trend in the past 12 months is executives being targeted. In this trend, specific people within organizations are being targeted and tricked into downloading malicious software on machines. In one of these scams last April, the targets were led to believe they were being subpoenaed to testify in federal court.

Last, but not least, the article points out that job scams are on the rise. It's a well established fact that job sites from Monster to Craigslist have scammers operating on them to recruit people to launder money, cash bogus financial instruments or give up all their personal and financial information. Adding fuel to this fire, it was disclosed recently that Monster.com had been hacked.

Capping off this interesting article — which is a pretty good recap of recent scam activity — is Pam Dixon of the World Privacy Forum pointing out that scammers have learned how to use "spell check." In the past, one of the best ways to identify a scam was it's lack of proper spelling and grammar. While the scammers might have have learned to use spell check, it might also point out that there are more and more people out of work (with better grammar skills), who are becoming scammers.

The WSJ quoted a lot of experts that agree with them that scam activity is on the rise. Another interesting read supporting this (not mentioned in their article) is the recent report that was commissioned by McAfee. This report points to all the unsecured data out there that is fueling the rise in cyber crime. They estimate, at this point, that the financial implications have reached $1 trillion. They also have some interesting information about social engineering and how it is being currently used to commit scams in the current economic environment in another set of articles on their main site.

In my opinion, it makes sense that scams of all kinds are on the rise. There is a lot of confusion going on and people are getting desperate. It might be desperation that is causing more people to get involved in scams on both sides of the fence. For the majority of us, who just want to ride these times out and survive the mayhem, the best thing to probably do is be extra diligent in our financial matters and use a little good old fashioned common sense.

Having dealt with a few scammers in my life, I've found that most of them aren't the most intelligent people around. The best thing to do is to think carefully before jumping in anything of a financial nature these days.

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Largest Identity Theft Ring in History Indicted

Yesterday, the U.S. Department of Justice announced that eleven perpetrators behind the largest known identity theft ring in history have been charged with conspiracy, computer intrusion and identity theft.

Allegedly, the group is responsible for stealing and selling more than 40 million credit and debit card numbers. The credit and debit card numbers were intercepted electronically at nine retailers, who transmitted their unprotected financial information using wireless networks. Once they hacked into the wireless networks, the group would install sniffer packets to capture card numbers and PIN numbers.

TJX, who was severely criticized for their breach of approximately 8.5 million records wasn't the only retailer being compromised. BJ’s Wholesale Club, OfficeMax, Boston Market, Barnes & Noble, Sports Authority, Forever 21 and DSW were being compromised, also. The restaurant chain Dave and Busters was also compromised by having "sniffer packets" installed on their point of sale terminals by the group.

Merchants have been under fire for not meeting PCI data security standards, which were developed by the payment card industry to protect systems against compromises. The National Retail Federation has fired back at the payment card industry for forcing merchants to store sensitive information, which can easily be stolen. In a recent data breach involving the theft of 4.2 million card numbers, Hannaford Brothers had been certified as being PCI compliant, which led a lot people to speculate that PCI data security standards might be outdated, themselves.

Sniffer packets are used to monitor information in a network and can be used to gather a lot of sensitive information. Detecting a sniffer packet on a wireless network is known to be extremely difficult. A practice known as "wardriving" is when people drive around and try to pick up wireless signals from unprotected networks. Computer security experts highly recommend making wireless networks secure, including those of the home variety, by password protecting them. Software to assist people, who do this, is freely available on the Internet.

After the information was stolen it was stored on encrypted computer servers in Eastern Europe and the United States. Some of the stolen data was sold to other information criminals via the Internet. The group also counterfeited their own cards and used them to steal money from ATMs.

Recently, Finjan, a computer security company, announced finding servers with a lot of stolen information on the Internet. At least one the crimeservers found by Finjan wasn't even password protected. Finjan reported finding these crimeservers using simple Google searches.

The money was laundered using internet based currencies and by moving funds through banks in Eastern Europe.

Three executives at E-Gold, which is a internet based currency, recently pleaded guilty to allowing criminal activity of this nature (money laundering) using their service.

The criminal activity started in 2003 and went right up to the present time. Albert "Segvec" Gonzalez, of Miami, one of the main players in the group was previously arrested for similar activity in 2003. During the current investigation, the Secret Service discovered Gonzalez was working as a government informant and involved in the criminal activity at the same time.

Also charged in the indictments yesterday were Maksym "Maksik" Yastremskiy, of Kharkov, Ukraine, and Aleksandr "Jonny Hell" Suvorov, of Sillamae, Estonia. Hung-Ming Chiu and Zhi Zhi Wang, of the People's Republic of China were also charged. Sergey Pavolvich, of Belarus and Ukranians Dzmitry Burak and Sergey Storchak were also named in the indictment. Two U.S. citizens Christopher Scott and Damon Patrick Toey, finished up the long list of names from all over the world involved in this organized criminal enterprise.

The range of the activity took place in numerous countries, including the United States, Ukraine, Belarus, Estonia, the People’s Republic of China, the Philippines and Thailand.

These indictments are the result of a three-year investigation conducted by the Secret Service. As the case progresses, it is being reported that they will be working closely with the IRS, on the money laundering aspect of the case.

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Large scale data theft of U.S. information uncovered in India

Stealing personal and financial information in large quantities isn't just a problem in North America and the Europe Union. As more IT functions are outsourced to a variety of countries, this information might be getting compromised from just about anywhere.

Recently, it was disclosed in the Indian press that a large amount of data was stolen by an Indian BPO from a company in United States. It's amazing this story didn't get very much coverage in the West, despite the fact that the data was stolen from a company called Noble Ventures, which is based in Florida? As a slight disclaimer ComputerWorld (Norway) and CIO (Australia) did cover the story, but I was unable to find anything about it in the American press.

I suppose in this instance we will have to rely on the Indian media to provide some transparency to this event. Parth Shastri at TNN reports:

It could well be one of the biggest data thefts in the country. An Ahmedabad-based BPO owner, Maulik Dave, has been accused of data theft from a Florida-based company and selling them to its rival companies in the US.

Dave stole data worth Rs 1 crore (ten million) from the company. With the help of his accomplice based in the US, Milan Dabhi, he sold the data to competitors of the company in the US.

Apparently this occurred after Dave got his contract cancelled with Noble Ventures Inc., who "provides customer database of 1.25 crore (ten million) US citizens to various marketing companies in the US and also has a client-base in other international markets," according to the TNN article.

Of even greater concern to me was the deduction (my speculation) that Dave had insider access to their systems after his contract was cancelled? From the article, it is unclear if this was because the access was never removed, or if he got it from another Noble Ventures employee, Milan Dabhi, who is based in the U.S. and allegedly Dave's accomplice.

In another article published by the IT Examiner in India a person claiming to be a spokesman for Noble Ventures, Sunny Vaghela with credentials as a cyber crime expert, claimed that the information was stolen, but never sold. The rationale for this was that Noble Ventures reported the theft to Indian authorities and a sting (?) was conducted.

From the IT examiner article:

He further added claiming the theft report of 12.5 million Americans’ personal and professional records to be untrue as he assumed of some kind of miscommunication between the reporters and the Police.

While I hope this is true, the logic in this is flawed (my opinion) because the information was stolen by someone, who had inside access prior to the discovery that the data was being compromised. How can it be determined that it was never sold to anyone else? Information is bought and sold in a lot of places, including underground Internet forums set up for illicit purposes. Additionally, no matter where it might have been sold, it is unlikely that anyone, who bought it illegally is going to stand up and be counted in this affair.

I went to the Noble Ventures site and they offer a lot of information for a price. Targeted data on executives, "heroes" (police and firemen), veterans and a slew of other marketing segments can be obtained. They even sell e-mail lists.

While I couldn't determine if this information was enough to open a line of credit, it could certainly be used to mount telemarketing scams, spam campaigns and even whaling (phishing) expeditions like the recent one we've seen targeting executives in the United States. Verisign just reported that 15,000 white collar types were speared in this expedition.

Please note that even though I am assuming no financial or SSN information was compromised -- if a dose of social engineering, phishing or malicious software is added to the equation -- getting the rest of the information to commit identity theft would probably be fairly easy.

Incidents, such as this, continue to point to the fact that there is too much information being stored in too many not very well protected places. In fact, this incident might point to the fact that the problem is getting worse.

We also need to remember that this information came from a U.S. company, and although I don't know where the server was physically located, it didn't have to be located in India for this to have occurred.

Information like this is protected by the FTC's Telemarketing Sales Rule.

Violations in the United States of this rule can be reported, here.

TNN story from India can be seen in full, here.

ComputerWorld, Norway story about this, here.

CIO Australia story, here.

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Bank of Mellon reports a second data breach

Last week, the Bank of Mellon disclosed they had lost unencrypted tapes containing the personal and financial information of several million people about three months ago.

Now it is being revealed that about a month ago, another incident involving a missing (unecrypted) tape occurred. This time, scanned images of checks, along with other assorted sensitive information disappeared. The Check 21 Act, passed in 2004 allows financial institutions to electronically deposit images of checks instead of using the actual paper check, itself.

According to press release on the matter, they are now going to start using encryption. I wonder how many other institutions out there are still not encrypting all of their confidential information?

Ironically, if you read the privacy and security pages on Bank of Mellon's site, they seem to be very pretty savvy about both identity theft and privacy issues.

The first incident occurred on February 27th and the now revealed second incident occurred April 29th. If they knew it happened on April 29th, why wasn't this one reported with the other one? The February 27th incident was reported last week, which was well after April 29th.

Of course, I'm sure that the "official explanation" will be that they didn't know if it was really missing and no one is really sure if the information is being used to commit identity theft.

Here is the low down as reported in Pittsburgh Tribune Review on the April 29th occurrence.:

The most recent incident occurred on April 29 when a backup data-storage tape containing images of scanned checks and other payment documents was lost while being moved from Philadelphia to Pittsburgh, spokesmen for the bank said Friday. It involved data of 47 institutional clients and a yet to be determined number of individual customers.

A ComputerWorld article by Brian Fonseca highlighted concerns that are being investigated by Connecticut Attorney General Richard Blumenthal, who is working with his peers in other States to determine why it took so long to report the matter. AG Blumenthal is also asking some hard questions as to why some tapes disappeared and other ones arrived at the storage facility.

The obvious reason, he might ask this question is that it probably points to an insider being involved (my speculation). If this is the case, it is very likely they had somewhere to get rid of the information, or more specifically, sell it.

His press release on the matter listed a lot of institutions, who may have had customers compromised in these incidents.

One thing I wanted to add is that in the most recent occurrence, they are stating scanned checks were contained on the tape. This would make it pretty easy for criminals to use the information to produce counterfeit checks. In recent years, we've seen checks counterfeited on a massive scale, and sent all over the world via snail mail, or even Federal Express and UPS. A recent joint investigation conducted in several nations revealed that these items were being produced on an industrial scale in certain countries.

Many of these counterfeit checks are passed via "too good to be true scams" on the Internet. There are also organized criminal gangs that pass counterfeit checks, also.

Interestingly enough, the way laws governing counterfeit checks are written, the banks have almost zero liability and pass off the loss to the entity who accepted them.

Since counterfeit checks are normally exact copies of actual checks, this made me wonder if sometimes the source of the information to produce them is coming from all the scanned checks being electronically transferred between businesses and financial institutions? Payment (credit/debit) card is transmitted and stored pretty much the same way, and there is certainly a history of these transactions being targeted for criminal purposes, frequently.

According to their most recent press release, the Bank of Mellon is offering free credit monitoring and identity theft insurance through Experian. This has become standard in the wake of most data breaches, but it doesn't necessarily protect a person from all forms of identity theft.

Some examples of where free credit monitoring doesn't catch identity theft right away are medical benefit fraud, employment fraud, government benefit fraud, some forms of check fraud and last, but not least, when it is used to commit crimes of other than a financial nature.

Additionally, the ComputerWorld article mentions that at least one class action law suit has been filed as a result of this:

This week, a lawyer representing 40 affected individuals filed a class-action lawsuit against the New York bank in Connecticut Superior Court. Attorney Michael Stratton, who represents the plaintiffs, said he is seeking up to seven years of free credit monitoring and credit insurance for customers, along with unspecified damages.

I found a list of companies that might have had their customers compromised in these data breaches on the Connecticut AG site:

People's United Financial Inc., John Hancock Financial Services, Inc. (acquired by Manulife Financial Corporation), The Walt Disney Company, TD Bank Financial Group, The Bank of New York Mellon Corporation, Hudson United Bancorp (acquired by TD Bank Financial Group), United Parcel Service, Inc., Wachovia Corporation, MetLife, Hudson City Bancorp, Eastman Kodak Company, Burlington Resources (acquired by ConocoPhillips Inc.), Providian Financial (acquired by Washington Mutual, Inc.), Penn Fed Financial (acquired by New York Community Bancorp), ADESA, Inc., Alcatel-Lucent, Odyssey America Reinsurance Corporation, Seacoast Financials Services Corp. (acquired by Sovereign Bancorp), Viewpoint Bank, Diamond Shamrock (acquired by ConocoPhillips Inc.), Sound Federal Bancorp (acquired by Hudson City Bancorp), Big Lots, Inc., Guidant Corporation (acquired by Boston Scientific Corp), New York Community Bancorp and ACE Limited.

Bank of Mellon press release on this matter, which contains information for potential victims, here.

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We are a long way to full disclosure in data breaches - even if we wanted to be!

I saw an article on PCWorld, written by Robert McMillan (IDG News), that according to the research firm Gartner -- not all data breaches are being reported by retailers.

I thought to myself ... here we go again ... burying our heads in the sand that all personal and financial information is hacked from retailers. Of course, that isn't to say that none of the stolen information is coming from retailers, either.

The conclusion was based on 50 retailers being interviewed and 21 of them saying they had been breached. Of these 21, allegedly only 3 had reported a data breach.

This led me to wonder if any of these retailers do business in an area, where disclosing data breaches is a matter of law?

My humble guess is that in the litigation happy society we live in today, no one is going to report anything unless they have to. As long as no one is certain (or they can get away with saying that) the information is probably buried, or someone comes up with a rationalization that it really didn't happen.

Going a little further, there has to be a lot of information being stolen that no one is even aware has been compromised. The fact that no one is aware it was compromised makes it easier to be used by the criminal element, effectively.

The sad truth is even if you could make computer systems bulletproof, human beings will continue to compromise information, either via social engineering techniques or to obtain financial compensation. We've made some of this information worth a lot of money.

Of course, information thieves often combine technology and social engineering, also. In the mysterious world of information crime, one shoe rarely fits all.

Right after reading the PCWorld article, I happened upon more research from Finjan, which might provide evidence that there must be a lot of computer systems out there that are NOT very "bulletproof."

As stated on Finjan's MCRC blog:

In our recent MPOM report, we reported on a Crimeserver hosting 1.4G of unprotected stolen data, including passwords, medical data, emails etc.

Many people asked us how we found the data. Was the data secure or not?

Although we cannot disclose all information to the public (for obvious reasons), I can say that the data on that Crimeserver was unprotected, meaning anyone could access it.

Today we came across another Crimeserver - it seems that we are finding one every other day...

Additionally, Finjan reported:

As we disclosed in our Q3/2006 Trend report, malicious code is hosted on caching servers of leading Search Engine Providers. This time we reported in our recent MPOM that stolen end-user data is also stored on these caching servers. Yes, your passwords, Social Security numbers, Online banking information …. no data is safe, as the examples below illustrate.

Even more alarming, it didn't take a lot of know-how to access all this information. The people at Finjan were able to do it, using simple Google searches.

I highly recommend taking a look at the entire blog post from Finjan (link provided at the bottom of this page) -- there are some alarming visual presentations indicating how much information is out there.

I'll include one, which shows a compromised (actual info blocked out) SSN:



The blog post also has visual presentations (screenshots) of user names and passwords to internal company sites, porn sites and online banking sites.

Now let me see ... if stolen information is being hosted on unprotected (anyone can access) crimeservers ... and it is being indexed (cached) by search engines ... it's probably safe to assume we don't have any real idea how much stolen information there is out there.

Also, please note it's safe to say not all this information came from retailers.

Last, but not least, I've seen commentary that we should blame Google for all this. First of all, I doubt that Google is the only place this information can be found. Another thing to contemplate is that thinking like this is as narrowly focused as thinking that retailers are to blame for most of the stolen information out there.

Unless we stop blaming each other -- we are going to be a long way from achieving transparency in data breaches. Exposing problems often is the first step in correcting them.

Until we embrace transparency, the people to blame (criminals) are going to be laughing all the to the bank.

Finjan post from their MCRC blog, here.

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WTC construction plans/hundreds of worker's personal information trashed at Ground Zero

When it comes to information being compromised, a lot of it can be traced to simple human error a.k.a. "stupidity."

A glaring testament to this fact is being reported by the New York Post:

Hundreds of Ground Zero workers were exposed to potential identity theft when stacks of payroll sheets - which included their names and Social Security numbers - were dumped in the trash along with confidential plans for the new World Trade Center.

Plans for the new Port Authority Police Station were also found.

Fortunately, a homeless person discovered the plans for the new Freedom Tower (presumably while dumpster diving).

This prompted two unnamed individuals, described as "salvage experts" to turn in the other sensitive documents found in the trash:

Included in the stash were blueprints for World Trade Center 4 and the temporary PATH station, construction specifications for World Trade Center 7 and plans for the PA Police headquarters.

In this instance, we are probably lucky that salvage experts and a homeless person found this sensitive information instead of a criminal, or even worse, an Osama Bin Laden "wannabe."

If you would like to see other examples of human error, or stupidity being the cause of information being compromised, the DLDOS database at Attrition.org and PogoWasRight have a lot of examples that they share with the public-at-large.

PogoWasRight's mantra, "WE HAVE MET THE ENEMY AND HE IS US" certainly applies in this instance!

New York Post story by Lukas I. Alpert and Matthew Nestel, here.

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How did hackers plant malware at Hannaford Bros. and steal 4.2 million payment card numbers?

Hannford Brothers, the latest retailer to be compromised in a large scale data breach is reporting that hackers using malware breached their systems.

The next million dollar question (literally) is how was the malware (sometimes referred to as crimeware) dropped on their system? A lot of people are looking at this carefully because the company had been certified as meeting PCI (Payment Card Industry) data protection standards.

Ross Kerber at the Boston Globe, who gets the hat tip for breaking this latest development in the story wrote:

Data security specialists say the new details show how hackers have grown more adept at penetrating weak links in the systems that connect merchants and banks. In previous breaches, such as the record-setting intrusion at TJX Cos. of Framingham, where as many as 100 million card numbers were compromised, hackers took advantage of merchants who stored customer names and card data - sometimes in violation of payment industry standards - at central locations in their computer networks.

In contrast, Hannaford says it did not store customer information. The hackers who struck Hannaford mined a stream of data that the merchant and banks were not responsible for protecting under industry rules, industry specialists said.

Because hackers, criminals and misfits rarely give up their latest hacks, we'll have to be content with speculation from the experts.

Jaikumar Vijayan at ComputerWorld was able to get some expert speculation from "Mike Paquette, chief strategy officer at Top Layer Networks, a vendor of intrusion-prevention systems in Westboro, Mass." Bill Brenner at SearchSecurity.com wrote about increasing speculation that a dishonest insider planted the malware on Hannaford's network.

The insider theory intrigues me because it seems that most security breaches can be traced to a social cause. A dishonest human --who has been given access to a system -- can defeat a lot (most) computer security.

Going further into all the speculation has come about from the Hannaford announcement, I decided to see what the blogosphere had to say.

Securosis.com gives a lot of interesting perspective in their post, Picking Apart The Hannaford Breach- What Might Have Happened .

The post points out some interesting thoughts, such as that credit card numbers are useless without names (Hannaford claims no names, or social security numbers were stolen) and that the breach was most likely discovered at financial instiutions when customers complained about fraudulent transactions on their cards.

rmogull summed up his "admitted" speculation with:

In conclusion, it looks like some sort of a network breach (which could be anything from phishing/malware to compromise from a retail location to a full network hack). A sniffer was possibly installed, since it seems they don’t keep credit card information (again, assuming statements are true). The fraud was detected by the banks or credit card companies, then it took a little under two weeks to contain. Not great, and indicative of either a little sophistication on the attacker’s part, or a lack of sophistication on Hannaford’s part.

There are also some interesting comments with more speculation at the bottom of the post. From what I can gather a lot IT types read this blog.

In the end, as long as there is lack of transparency in data breaches, the best anyone can do is speculate. The reasons for a lack of transparency in data breaches are a mile long, encompassing everything from protecting ongoing investigative efforts to avoiding the financial pitfalls of all the litigation that arises after a data breach.

Of course, in more simple terms, it might also mean that no one is really sure?

Given that, I wonder if anyone can be really sure that their personal information is safe? Your guess is probably as good as mine!

Previous posts on this blog about the Hannaford Data Breach:

Security vendor removes Hannaford as a client on their site after data breach is revealed!

Hannaford Brothers data breach might reveal current security standards are outdated

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Hannaford Brothers data breach might reveal current security standards are outdated

Hannaford Bros. Co., a grocery retailer based in the Eastern United States is the latest corporation to be victimized by a substantial data breach. Saying that, customers of Hannaford Bros. are going to be victimized, also. So will a lot of financial institutions, who have to deal with the fraud claims and trying to prevent the information from being used.

Whenever a data breach of this magnitude occurs, there are a lot of victims.

This breach occurred despite that fact Hannaford Bros. had met the payment card industry (PCI) standards for data protection and were not using wireless technology to transmit unencrypted data. Both of these factors were said to have caused the now infamous TJX breach, where approximately 98 million records were compromised.

This time only a reported 4.2 million records have been stolen, but it's still early in the game and historically these estimates tend to blossom with time.

A press release from Hannaford revealed that no personal information was stolen in this occurrence and that only payment card (credit/debit) card numbers are at risk.

Additionally, there have been 1800 reported cases of fraud tied into this data breach thus far.

Today, the AP was able to get a comment from their corporate headquarters:

It was during the card approval process that more than 4 million customer accounts at grocery stores in the Northeast and Florida were exposed to fraud, even though the company meets the latest standards for data security, a spokeswoman said Tuesday.

Hannaford Bros. Co. doesn't yet know how the breach — which began Dec. 7 and ended March 10 — occurred, said Carol Eleazer, vice president of marketing for Hannaford, based in Scarborough.

About 4.2 million credit and debit card numbers were exposed and at least 1,800 stolen during the seconds it takes for that information to travel to credit card companies for approval after customers swiped their cards in checkout-line machines, Eleazer said.

Brian Krebs of the Washington Post, who does the Security Fix blog quoted an industry expert, Bryan Sartin at Cybertrust as stating:

"I would say a trend we're seeing hitting a lot of retailers right now is that these organizations can be [compliant with the credit card industry security standards] and still have customer data stolen," Sartin said. "The data in transit is allowed to traverse private links and internal infrastructure without being encrypted, and the attackers are taking advantage of that."

Once these systems have been compromised, Sartin said, the attackers typically eavesdrop on the network using "sniffer" programs that can extract credit and debit card data as it moves across the wire, before it even leaves the store's network.

If the theory in Security Fix is pans out (probably will), some precedents might exist for the basic method the hackers used. The incidents, I will reference don't sound as sophisticated as what Mr. Sartin is describing, but they happened about a year ago and hacking methods tend to mature with age.

Stop and Shop was the subject of a data breach a little over a year ago. In this case, PIN pads were being replaced with "look-alike" devices that captured all the payment card details. This hardware was later removed to download all the information that had been captured when unsuspecting customers swiped their cards.

Shortly thereafter, another compromise of this type was reported in Edmonton, Canada. In this case, a blue tooth device was used to transmit the information to a waiting car in the parking lot.

The trend with PIN pad replacement continued with a smaller breach at a grocer in the San Francisco Bay area, Albertsons in April of 2007. At the time, I had the pleasure of speaking with Blanca Torres, who was doing an article on the story.

Interestingly enough, up North in Canada, where payment card skimming has increased six-fold in recent years, an announcement was made that they plan to introduce a smart card. This technology, which is known as "chip and PIN" is already in use in Great Britain and France.

The AHN story about this by Vittorio Hernandez included (what I consider) a sage comment:

But Peter Woolford of the Retail Council of Canada is wary that although the smart cards appear to be effective in reducing incidents of fraud, sinister minds may one day find a way to hack the smart chips. "Anything the human brain puts together, another human brain can take apart," Woolford pointed out.

Sadly, once this all pans out, it will likely reveal that PCI data protection standards can and will be compromised in the future. The reason, I say sad is because a lot of retailers have spent a lot of money becoming compliant.

Throw in all the finger pointing and litigation between the different parties in all these breaches and I fear we're going to be fighting a very costly battle over what is becoming a too common item in the news.

I'll sum this post up with a rant, I wrote when the TJX breach was attracting a lot of attention:

While everyone sues TJX, the criminals are laughing all the way to the bank

Press release from Hannaford about the breach, here. They list a telephone number on it, where more information can be obtained if you think you've become a statistic.

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Naughty UCLA employees peek at Britney's medical information

The LA Times is reporting that UCLA Medical Center employees were caught "peeking at" Britney Spears' medical records when she was recently hospitalized in their psychiatric unit.

I wonder if a total lack of privacy might be one of the underlying reasons Britney was admitted to this particular unit?

Charles Ornstein reports:

UCLA Medical Center is taking steps to fire at least 13 employees and has suspended at least six others for snooping in the confidential medical records of pop star Britney Spears during her recent hospitalization in its psychiatric unit, a person familiar with the matter said Friday.

In addition, six physicians face discipline for peeking at her computerized records, the person said.

The article states that this was the second time Britney's records were compromised at the UCLA Medical Center.

UCLA used stronger verbiage when reporting that their computer records were compromised in December of 2006.

As reported at the time by UCLA's Office of Public Relations:

UCLA is alerting approximately 800,000 people that their names and certain personal information are contained in a restricted database that was illegally and fraudulently accessed by a sophisticated computer hacker.

It should be noted that "illegally and fraudulently accessed" and "computer hacker" are stronger terms than "peeking" and "snooping." Maybe this is because the hacker is an outside entity and we can speculate they had a financial motivation when accessing information they weren't supposed to?

As long as we are speculating -- let me bring up another point -- which is there are a lot of people obviously making a lot of money from the Britney Spears saga. Her personal medical details might be worth a lot of money to the people, I'm referring to.

Recently, it was reported that People Magazine paid $4 million for the first pictures of Brad Pitt and Angelia Jolie's baby. Maybe a little privacy was one of the reasons they went to a remote place in Africa to have the baby?

Now I'd better get back to the larger problem, we face from too much information being stored in too many (not very secure) databases.

The problem is that with so many databases out there -- coupled with all the publicly disclosed data breaches -- tracking any one case of a person's information being compromised is nearly impossible.

Just ask anyone, who has actually investigated a case of identity theft. Most of the time, the best that can be done is to speculate where the information was actually compromised.

At this point in the game, a lot of people have been compromised in more than one location.

I would also speculate that there are even a greater number of data breaches out there that no one knows about. My guess is that the people, who steal information, would prefer to remain anonymous. Transparency has never been in the best interest of information thieves.

This brings up another problem that ties into this, or what is known as medical identity theft. While medical identity theft hardly ties into Britney Spears getting her information "peeked at," it has become a huge problem. The tie would be the ease in which naughty employees, with no business looking at it, were able to do so.

In the end, UCLA is a highly respected institution. They do seem to care that this happened and are taking the standard measures to prevent it from happening again. The problem here is that time and time again, it appears that some of these measures don't work very well.

The bottom line is that if things like this can happen at a respected institution of higher learning's medical center, it's probably happening at more places that we realize!

Speaking of this happening at more places than we realize, it was recently reported (3-12-08) that Harvard is one of the latest institutions to be victimized by a data breach.

As long as we rationalize things away by using terms like "peeking," I doubt the problem is going to get fixed in the near future. UCLA is probably only following standard data compromise protocol. Read the press releases after any compromise of data and there is a lot of rationalization and speculation.

This probably means we need to do a little less rationalizing and going beyond mere speculation when addressing what has become a serious issue. This will entail taking a hard look at the core reasons this keeps happening, one of which is, an ever increasing lack of privacy in the world today.

If you would like to see why UCLA isn't the only one who has had a problem with this issue, Attrition.org and PogoWasRight do a great (transparent) job of reporting the known spectrum of the problem.

If you want to read more about medical identity theft, the World Privacy Forum is an excellent resource.

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Finjan discovers criminal database with 8700 account credentials to trusted domains!

Is the Corporate World under attack by hackers? A new report from Finjan suggests that top level domains have been compromised and access details are for sale on the black market.

It should be noted that government domains have been allegedly compromised, also.

From the Finjan press release:

Finjan Inc., a leader in secure web gateway products, today announced it has uncovered a database containing more than 8,700 harvested FTP account credentials, including username, password and server address - in the hands of hackers. These stolen credentials enable criminals to compromise servers and automatically inject crimeware to infect users visiting them. Among those stolen accounts are those of Fortune-level global companies in a wide range of industries including manufacturing, telecom, media, online retail, IT, as well as government agencies. The stolen FTP accounts include some of the world’s top 100 domains as ranked by Alexa.com.

Dark Reading Kelly (Jackson Higgins) went more into depth on the risks associated with this new discovery:

The so-called meoryprof.info (Me-or-you-Profit) site is selling username, password, and server addresses of these FTP servers as well as the NeoSploit Version 2 crimeware package, which basically lets the bad guys who buy it instantly infect these sites with malicious code -- with the goal of stealing valuable and confidential data from them as well as any visitors to the sites. It also “qualifies” the stolen accounts so that buyers either can then set a price to resell the compromised FTP credentials to other cybercriminals, or determine which are the more potentially lucrative sites to hack.

“With a click of a button they say ‘I want to infect his FTP server’ with the crimeware,” says Ben-Itzhak. Finjan did not test all of the sites to see if they had been infected yet or not.

From a more social perspective, this continues the scary trend of crimeware for sale, which enables not very technical criminals to commit fairly technical crimes at will.

Besides the fact that (in theory at least) sensitive information can be stolen from some of these sites, a visitor can be compromised when visiting a "trusted site."

Besides the risk of sensitive information being compromised, compromised sites, once publicized might face another problem a.k.a. unfavorable public exposure. This could lead to a loss of trust in their brand, and as seen recently, potential litigation.

This doesn't even take into consideration all the other assorted costs of recovering from a large scale data compromise that becomes public knowledge.

Finjan is inviting the corporate world to make inquiries, whether or not, their particular site is at risk. I'll provide the link to do so, here.

They are also providing more information on this latest crimeware kit on their "Malicious Page of the Month."

Dark Reading story, which seems to be a good information source on this story, here.

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Chinese Hacker(s?) steal data on 18 million people in South Korea

Data breaches aren't just a problem in North America and Western Europe. In fact, it's probably safe to say that that the problem has become International in nature.

In the era of the global economy and with outsourcing, saavy hackers can probably get their hands on North American and European information outside those geographical areas fairly easily. IT is (also) probably less likely that anyone will be forced to be transparent about a data compromise in many of the areas information is currently being outsourced to.

That isn't to say that everything is 100 percent transparent when a data compromise occurs in the West, either.

Found this interesting blog post on The Dark Visitor (Inside the World of Chinese Hackers):

According to Hackbase.com, South Korea’s oldest and largest online shopping site (Auction.co.kr) has claimed it was attacked by a Chinese hacker who made off with the user information on 18 million members and a large amount of financial data. It is further claimed that Auction.co.kr delayed 20 hours after the attack before confirming the loss of information. Korean users rebuked the website for being too slow to act. It was confirmed that the attack was launched through China’s internet.

The post speculates (probably very accurately) that the site was compromised by phishing the staff at Hackbase.com (interesting name), who more than likely gave up their log on credentials to the hacker. This is normally accomplished by dropping malicious software containing a keylogger that steals all sorts of personal information from a compromised system. The same thing often occurs with social engineering techniques, where someone is tricked into giving up information they shouldn't have.

It is amazing how many employees fall for phishing attempts. I recently pointed to examples of this in North America, where the IRS and the employees of a Nuclear facility were successfully phished.

There is no doubt that part of any internal due diligence process should include training employees on social engineering, spam and phishing.

Full post from the Dark Visitor (interesting site), here.

Here are two posts, I recently did about employees getting phished for information:

Human beings are the reason for most security breaches!

IRS audit reveals that the human factor is one the greatest threats to information (computer) security

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BBC article on UK data breach suggests why we are never sure if the information is used by criminals

Now that we KNOW the loss of computer discs containing the vital statistics of 25 million children in the UK wasn't caused by one person, everyone is probably going to start arguing (whether or not?) criminals are using the information.

Even worse, it's now been revealed that unencrypted discs with a lot of personal information were being sent snail mail as a routine method of transport.

Mark Ward at the BBC wrote an interesting article that suggests why we often aren't sure if the information is being used. In the article, he writes:

"In the fraud underworld the quality of data directly impacts the flexibility with which they can use it," said Andrew Moloney, financial services market director for RSA Security.

The more data you have around a subject the more different ways you can use that to commit fraud."

There was no evidence yet that the data was being talked about or sold on the fraud boards and net markets that his company monitors, he said.

However, most vendors of stolen data rarely mention where they got it from. Instead, they typically only mention its quality.

The bottom line is it can be almost impossible to track any one case of identity theft back to it's source. Furthermore, the criminals selling and buying aren't likely to advertise where they got it from.

Transparency is bad for criminals, also. It tends to get them arrested.

At this point in time, there have been so many data breaches we probably have no idea where the information came from when an identity is stolen.

The BBC article also covers a lot of common sense factors relative to protecting information. Time and time again, we discover that a lot of data breaches could have been prevented by using a little common sense.

The full BBC article (excellent read) can be seen, here.

The Privacy Rights Clearinghouse, Attrition.org and PogoWasRight are my favorite places to TRY to keep up on all the data breaches. As of this writing only PogoWasRight has information on this particular data breach.

Of course, these are only the occurrences that have been reported. My guess is there are probably many more that no one knows about.

Another safe bet is that the next big data breach not reported yet is probably happening right now!

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Student narrowly escapes expulsion for revealing data breach

It might be a good idea to be careful (or extremely anonymous), when reporting a data breach.

Jaikumar Vijayan at Computer World is reporting an interesting case -- where reporting a data breach brought about some personal grief for both the person, who reported it -- and the person they reported it to.

This person, who was a student, was almost expelled for bringing the matter to light. And the person, who it was reported to is no longer employed.

I guess whistle-blower laws don't apply at institutions of higher-learning?

For more information on whistle-blower laws, whistleblower.com is a decent reference.

Jaikumar writes:

A student at Western Oregon University who accidentally discovered a file containing personal data on a publicly accessible university server and then handed that data over to the student newspaper has narrowly escaped being expelled for his actions.

But a contracted adviser to the newspaper has been dismissed for allegedly mishandling the data and for failing to properly advise the students on the university's policies relating to handling of personally identifiable data.

Brian Loving, a student at WOU, stumbled upon a file containing the names, Social Security numbers and grade point averages of between 50 to 100 students on a publicly accessible university server in June. Loving downloaded a copy of what he discovered and handed it over to the Western Oregon Journal, the campus newspaper.

Institutions of higher learning are frequently the targets of hackers stealing information. This has been well documented by the Privacy Rights Clearinghouse, Attrition.org and PogoWasRight.

Given all this evidence, it amazes me that the highly educated people running these institutions still insist on using social security numbers as the primary method of identifying their students.

Social security numbers are worth money to the people, who like to steal them. Perhaps, if these institutions of higher learning, understood this a little better, they wouldn't be targeted nearly so often.

A little common-sense goes a long way.

Computer World story, here.

If you get a chance, read the comments on Jaikumar's story. Some of them are pretty good!

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Retailers call for a level playing field on data security

The data breach at TJX, which compromised approximately 45 million people has spawned a looming battle between retailers and the financial industry. At stake is who will bear the future costs of data breaches, which are becoming more expensive than ever before.

Thus far, we've seen legislation introduced to hold retailers responsible and calls for PCI data security standards. Legislation has been passed in Minnesota and is awaiting Governor Schwarzenegger's signature in California.

In any disagreement, there are two sides to a story -- and now the National Retail Federation (NRF) is bringing up what I consider is a valid point -- which is if they weren't required to store all this information, it would be harder to steal.

Under current rules, they are required to maintain too much information for 18 months, or face what are known as chargebacks.

Chargebacks are when a customer requests a refund from their card issuer, normally because of fraud. Please note that some dishonest customers claim fraud, when it never occurred. Additionally, the payment card industry sets the due diligence standards when accepting their cards and actively promotes their use.

The bottom line is -- merchants can accept payments, follow all the rules, and if they can't provide the required information -- they get charged for it, anyway.

With all the fraud that results from payment cards, this could get pretty expensive for a retailer, if they fail to control it.

Saying all this, we need to consider the bigger picture, which is the best way to protect data is to limit how many places it is being stored. This principle should be considered in a lot of other places besides retailers, also.

Mark Jewell of the AP is reporting:

The National Retail Federation on Thursday urged a card industry organization to stop requiring retailers to keep customers' card numbers for up to 18 months.

The stored data helps track product returns and disputed or suspicious transactions. But retailers say the data would be more secure if only credit card companies and banks that issue the cards stored it.

"It makes more sense for credit card companies to protect their data from thieves by keeping it in a relatively few secure locations than to expect millions of merchants scattered across the nation to lock up their data for them," David Hogan, the retail federation's chief information officer, said in a strongly worded letter.

In the article, Mr. Hogan brings up the very reason that retailers have been holding on to what some consider, too much information:

Hogan said in an interview that retailers routinely hold onto information because credit card companies ask them to produce data from transactions as old as 18 months to verify product returns and protect against fraud. If retailers can't produce data showing the product was legitimately purchased, they can end up reimbursing banks and card companies, Hogan said.

Only 44 percent of large retailers are now PCI compliant. This month, the larger retailer's banks will start facing fines for failing to become compliant. Banks that service medium size retailers will start facing fines in January.

This doesn't even take into account smaller merchants, who often are victimized the most by fraud, and chargebacks.

In case you don't understand how chargebacks can be a burden to a merchant, I've included a YouTube video at the bottom of this post, where a small merchant rants about chargebacks from PayPal.

The frustration expressed in this video is the same one felt by a lot of merchants (retailers).

The basic issue in all this is who will end up paying for it. Since no business remains solvent if they are losing money, the costs are going to end up being passed on to the consumer.

So far as the NRF's point, I think it is entirely valid. If retailers didn't have to store all this data, it would be one less place, where criminals could access it.

After all, while data breaches at retailers have gotten a lot of attention recently, they are not the only place they are occurring.

If you are interested in seeing what I mean by this the Privacy Rights Clearinghouse, PogoWasRight and Attrition.org all try to keep track of as many of them as they can.

All of them will tell you that their efforts only document the known breaches. There are probably many more that no one knows about -- and the last I heard -- the criminals behind them keep this a closely guarded secret.

After all, disclosure of a data breach impacts their bottom lines, also.

My personal solution is for everyone to get together and go after the real people behind this problem, or the criminals. Everyone would benefit from this!

My guess is they (the criminals) could care less, who ends up paying for all the damage they are causing.

AP story, here.

National Retail Federation (NRF) press release, here.

Here is the YouTube video (mentioned above), which reflects a small merchant's frustrations with the chargeback process. Please note that smaller merchants are bound to have a stake in what becomes of this controversy, also.

(YouTube video courtesy of Terry)

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Mysterious Gap vendor loses laptops with 800,000 people's information on it

(Banana Republic photo courtesy of Paul Rene at Flickr)

Gotta love the latest data breach at the Gap. First of all, it involves laptops stolen -- then it is disclosed that the information, which includes everything needed to complete a full identity assumption -- wasn't even encrypted.

Stolen laptops compromising a lot of people's information isn't a new twist in the world of data breaches. Given this, it's amazing that this rather personal information wasn't even encrypted.

This doesn't even take into consideration -- that although they knew about it since September 19th, they waited ten days to announce it -- and then do so on a Friday. TJX made their announcement of their intent to settle the class action law suits resulting from their data breach last Friday.

Strange how these disclosures always seem to happen right before the weekend?

Moving on, the GAP and their vendor (Taleo Corp) -- who runs the job site, where all this information was data mined -- are pointing their fingers at a mysterious third-party vendor, who neither of them will name.

They are offering the now standard free credit monitoring, and their official statement is THAT it's against the Gap's policy to store information on unencrypted laptops. AND OF COURSE, they also have no reason to believe this information is being used.

As I've written many times before, the irresponsible passing (frequently for profit) of people's personal and financial information is what makes it TOO EASY for criminals to steal it.

When the information is passed to several different places, it gives all the people passing it, plausible deniability that they were NOT the point of compromise when a person becomes an identity theft victim.

Last I heard, the criminals stealing the information don't want to let anyone know where they are getting it, either!

Recently Monster.com was compromised for a lot of applicant information, also. Here is the post, I did on that:

Monster.com might be sending you a letter that your information was compromised

Job applicant information seems to be a hot commodity for thieves lately.

If you have applied for employment at Old Navy, Banana Republic, or the GAP you can call 1-866-237-4007 to see if you might have a problem. The GAP has set up a website to assist those, who might have been affected by this latest data breach.

Now that I'm finished ranting, it would be unfair to blame the GAP for all the data breaches that hit the news too frequently. Data breaches are expensive for the company that was breached, bad publicity and they put a lot of people at risk.

As I write this, I can almost bet there is another company being targeted for information. The million dollar questions is -- what are they doing to make sure they aren't the subject of next week's data breach?

Hopefully, I won't find out who I am talking about next Friday night!

AP story about this (courtesy of the LA Times), here.

More updated version of the story by Robert McMillan (PC World) courtesy of the Washington Post, here.

The Privacy Rights Clearinghouse documents data breaches, if you take a look at their chronology, you will see that information being compromised by someone stealing a laptop is nothing new.

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