One of the oldest banks in the U.S. state of Connecticut became the latest U.S. financial firm to lose confidential data after a tape containing information for around 90,000 customers and employees went missing while in transit to a credit reporting bureau.
People's Bank announced the loss on Jan. 11, 2006. The information contained on the tape - names, addresses, Social Security numbers and account numbers – is sufficient for criminals to write out cheques in the name of someone else. The bank says the tape was lost while being transported by the courier UPS to the TransUnion credit reporting bureau.
The bank already knew of the incident in the days leading up to New Year. A two-week investigation followed, and on Jan. 11 the bank started notifying customers. People's Bank says it has not received any reports of unauthorised activity and there is no reason to believe that the data has been used inappropriately. Though it is unlikely to thwart a determined criminal, representatives of the bank did point out that a special apparatus was needed to read the tape.
In a letter sent out by the bank to affected customers, it was explained that the data contained on the tape was insufficient to gain unauthorised access to clients' accounts. According to the bank, there was no mention of account balances, debit card numbers, PIN numbers or dates of birth on the tape.
People's Bank has since offered their clients an account monitoring service for free over the next year. It will allow customers to track all their account transactions and in some case may reveal fraudulent operations.
Founded in 1842 and with current assets amounting to $11 billion dollars, People's Bank is one of the oldest and largest banks in the state of Connecticut. Any leak of confidential data could cause significant damage to the bank's reputation.
The People's Bank incident is just the latest in a growing list of financial institutions that have lost sensitive data during transportation. In the spring of 2005 Bank of America reported the loss of private data on 1.2 million clients. In March of the same year CitiGroup subsidiary CitiFinancial lost a tape with material on 4 million clients. In both cases the losses occurred during transportation, with UPS responsible for the second incident. In December 2005 LaSalle Bank, a subsidiary of ABN Amro in the U.S., said a computer tape containing confidential data for two million customers was lost while being transported by DHL to a credit bureau.
“Companies constantly repeat the same mistakes: to effectively protect sensitive information during transportation you need only encode it, but nobody ever bothers to do so. All the aforementioned incidents show an irresponsible attitude towards questions of IT-security, at a time when a complex approach to the problem covers all possible threats, even the physical loss of data during transportation," says Denis Zenkin, marketing director at InfoWatch.
Source: People's Bank
