Feeds

Data collector charged $275,000 for leaking personal data

$20 a head. 13,750 heads

Website security in corporate America

One of world's biggest collectors of consumer data has agreed to pay $275,000 after federal authorities accused it of exposing the personal information of 13,750 people.

The payment, which settles charges the Federal Trade Commission brought against Choicepoint, amounts to just $20 per exposed consumer. The breach was the result of someone at the company inadvertently turning off a database monitoring system. Unknown intruders then accessed social security numbers and other details by conducting unauthorized searches.

Choicepoint's gaffe came even as the company was under court-ordered monitoring for a separate security lapse in 2005 that led to at least 800 cases of identity theft, according to the FTC. A year later, Choicepoint paid $15m and promised to implement procedures ensuring that consumer reports were provided only to legitimate businesses for lawful purposes. The data collector also agreed to regularly get independent assessments of its data security program through 2026.

Despite the ongoing scrutiny from the FTC, the Choicepoint employee switched off an electronic monitoring system designed to identify unauthorized access to customer accounts. During one of the four months the system remained inactive, unauthorized individuals used stolen credentials to look up personal information on 13,750 consumers listed in Choicepoint databases, according to the FTC.

Choicepoint, which is owned by Reed Elsevier, blamed the breach on a former government customer that failed to protect a user ID and password used to access its database. Its statement didn't explain why the monitoring system was shut off, but it maintained that the company remained fully compliant with its 2006 settlement agreement with the FTC.

The settlement came on Monday, a day before the FTC announced settlements in two other cases that harmed consumers.

The agency said the second-biggest US money transfer service had agreed to pay $18m to settle charges it turned a blind eye to crooked telemarketers who defrauded consumers out of more than $84m. Minnesota-based MoneyGram International also agreed to implement a comprehensive program to root out fraud and to perform background checks before hiring agents.

From 2004 to 2008, con artists bilked the people by calling them and claiming they had won lotteries or been awarded guaranteed loans but needed to pay taxes or insurance fees before they could collect. MoneyGram was chosen as the payment method because it allowed the scammers to pick up the transferred funds immediately and payments were often untraceable. Victims also have no chargeback rights or other recourse, according to the FTC.

The agency on Tuesday also said a children's clothing marketer has agreed to pay $250,000 for collecting minors' personal information without first getting their parents' permission. Iconix Brand Group had required customers to disclose a wide variety of details to receive updates or enter contests, according to the FTC. That included date of birth, full name, email address, mailing address, gender and phone number.

Iconix had collected the information since 2006. The practice violated the Children's Online Privacy Protection Act, the FTC said. ®

This article was updated to reflect that the $275,000 Choicepoint was required to pay was not a fine. Language was also added to reflect company comments that the fraud monitor was accidentally disabled by an employee and that the breach took place during a single month. A Choicepoint spokesman claims an FTC press release is incorrect in saying the 2005 breach resulted in 800 cases of identity theft.

Protecting users from Firesheep and other Sidejacking attacks with SSL

More from The Register

next story
Hackers pop Brazil newspaper to root home routers
Step One: try default passwords. Step Two: Repeat Step One until success
UK.gov lobs another fistful of change at SME infosec nightmares
Senior Lib Dem in 'trying to be relevant' shocker. It's only taxpayers' money, after all
Critical Adobe Reader and Acrobat patches FINALLY make it out
Eight vulns healed, including XSS and DoS paths
Spies would need SUPER POWERS to tap undersea cables
Why mess with armoured 10kV cables when land-based, and legal, snoop tools are easier?
TOR users become FBI's No.1 hacking target after legal power grab
Be afeared, me hearties, these scoundrels be spying our signals
Blood-crazed Microsoft axes Trustworthy Computing Group
Security be not a dirty word, me Satya. But crevice, bigod...
Snowden, Dotcom, throw bombs into NZ election campaign
Claim of tapped undersea cable refuted by Kiwi PM as Kim claims extradition plot
Freenode IRC users told to change passwords after securo-breach
Miscreants probably got in, you guys know the drill by now
prev story

Whitepapers

Secure remote control for conventional and virtual desktops
Balancing user privacy and privileged access, in accordance with compliance frameworks and legislation. Evaluating any potential remote control choice.
WIN a very cool portable ZX Spectrum
Win a one-off portable Spectrum built by legendary hardware hacker Ben Heck
Storage capacity and performance optimization at Mizuno USA
Mizuno USA turn to Tegile storage technology to solve both their SAN and backup issues.
High Performance for All
While HPC is not new, it has traditionally been seen as a specialist area – is it now geared up to meet more mainstream requirements?
The next step in data security
With recent increased privacy concerns and computers becoming more powerful, the chance of hackers being able to crack smaller-sized RSA keys increases.