The U.S. military veterans affected by a recent data breach have organized a coalition and filed a collective lawsuit seeking $26.5 billion from the federal government. Experts at the InfoWatch analytical center believe the law courts are unlikely to satisfy the demands in full, but there is a distinct possibility that the government could end up paying in the region of $13 billion.
InfoWatch has already reported on the incident, which is being described as the biggest ever data breach. An insider who violated office policy has been held responsible for the private data of around 26.5 million former military personnel falling into the hands of criminals. The secretary for Veteran Affairs told the U.S. Senate that the incident would cost the government $500,000, but according to estimates by the InfoWatch analytical center, it will cost at least $4 billion. It was later reported that the data of a further 50,000 active-duty servicemen had been compromised as a result of the theft from the employee’s home. However, the latest reports state that 2.2 million serving personnel have been affected. Moreover, the affected veterans have organized a coalition and filed a collective lawsuit seeking $26.5 billion from the federal government.
VA Secretary Jim Nicholson said the agency was mistaken when it said that up to 50,000 personnel were affected by the May 3 burglary. In fact, the names, birth dates and Social Security numbers of as many as 1.1 million active-duty personnel from all the armed forces, along with 430,000 members of the National Guard, and 645,000 members of the Reserves, were included. The announcement came as a coalition of veterans' groups charged in a lawsuit against the federal government last week that their privacy rights were violated by the theft. The lawsuit demands that the VA fully disclose which military personnel are affected by the data theft and seeks $1,000 in damages for each person – up to $26.5 billion total.
Experts at the InfoWatch analytical center note that the U.S. law courts are unlikely to satisfy such demands without reducing the sum claimed by the plaintiffs. Compensation of $500 per victim is, however, perfectly realistic. In that case the damage to the government, in purely legal terms, would amount to over $13 billion.
In response to the lawsuit, the Department of Veterans Affairs said it was in discussions with credit agencies to monitor the financial activities of those affected. If that is the case, then the calculations made by InfoWatch come into play. Accordingly, the U.S. government would face a bill of $3.5 billion.
In that case, the biggest data leak in history just got more expensive. No matter what, the federal government is going to have to part with several billion dollars.
“This incident demonstrates once again how dangerous data leaks can be. And the lion’s share of the expenses could well end up being legal costs. It should now be obvious to everyone that it is better to prevent data leaks than to try and pick up the pieces afterwards,” Denis Zenkin, marketing director at InfoWatch, is convinced.
Source: ContraCostaTimes
