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Ameritrade Customer Data Lost
Rollie Hawk writes "Continuing the recent trend of customer data blunders in the news, Ameritrade has announced the loss of the personal data of up to 200,000 customers. The suspected cause is a routing error, but not the network kind. The online discount broker admitted that a backup tape of customer account data from 2000 to 2003 has been misplaced. They claim the cause is an error on the part of a shipping company. The tape was identified as missing in February, soon after being shipped. According to spokeswoman Donna Kush, nothing suspicious has been reported. Further blaming the shipping company, she explained that "this was not an Ameritrade Systems issue or a compromise of our technology. This was related to a third party vendor." It's doubtful that current and former customers with exploited information will care how this occurred. She further claimed that Ameritrade "has every reason to believe" that the tape has either been destroyed or is being held by the shipper. There's no word yet on how they arrived at this conclusion."
I mean, it's probably more likely that some law got passed in the past few years that's forcing companies to highlight all these incidents of compromised data, but it seems pretty spooky that we just recently hear about all these stories...
Make sure everyone's vote counts: Verified Voting
If date is being transported via a 3rd party carrier, wouldn't it make sense to encrypt the data first?
Luckily it was insured against loss and Ameritrade will be recieving a check for $100 dollars!
oh HooRay!
Starsucks
A feeling of having made the same mistake before: Deja Foobar
Thankfully, all my tech stocks have tanked and there are no more assets to attack. As a matter of fact, I'm more likely to get sued by identity theives for ruining their reputations and credit ratings.
We could then refuse to do business with those companies on the grounds that they were obviously lying.
-- Nothing unusual happened today
...about how the data was lost. It's a little bit difficult to get angry about a lost package in the shipping process. It happens. It's always going to happen. It's rare, though. I'd be a little pissed off if this was due to a network breach at Ameritrade. As it is, I'm not too concerned. So, yeah, it DOES matter how the data was lost.
Further blaming the shipping company, she explained that "this was not an Ameritrade Systems issue or a compromise of our technology. This was related to a third party vendor."
No, it's an Ameritrade-picking-a-bad-vendor issue. It is still ultimately Ameritrade's fault.
So I've been creating a list of all the major cases I've heard about in 2005. Nearly 1.3 million people have been affected so far this year. Of course now Slashdot won't let me post the information because I have "too few characters per line."
r ade/
/ a/2005/04/14/financial/f064639D31.DTL
/ archive/2005/04/08/financial/f115753D39.DTL
0 05/03/29/BAG3MBVSFH1.DTL
h ed&ctrack=1&cset=true
I originally posted an expanded version of this list on my blog to start keeping track of everything.
Here is basically what it looks like:
Date: 04-18-2005
Name of Organization: Ameritrade
How: Lost backup tape with shipping agency
People Affected: 200,000
Link: http://money.cnn.com/2005/04/19/technology/amerit
Date: 04-14-2005
Name of Organization: Polo Raplh Lauren - Mastercards
How: "Security Breach" - Hackers
People Affected: 180,000
Link: http://www.sfgate.com/cgi-bin/article.cgi?file=/n
Date: 04-08-2005
Name of Organization: San Jose Medical Group
How: Stolen Laptop
People Affected: 185,000
Link: http://www.sfgate.com/cgi-bin/article.cgi?f=/news
Date: 03-29-2005
Name of Organization: UC Berkeley
How: Stolen Laptop
People Affected: 98,000
Link: http://sfgate.com/cgi-bin/article.cgi?file=/c/a/2
Date: 03-26-2005
Name of Organization: Northwestern University
How: "Security Breach" - Hackers
People Affected: 21,000
Link: http://www.chicagotribune.com/technology/
chi-050 3260274mar26,1,5138021.story?coll=chi-technology-
Anyway, this is definitely getting ridiculous and out of hand. And it seems we're pretty much helpless to control it as well. When are a lot of these companies going to stop requiring valuable information like social security numbers and such?
There is no excuse not to encrypt all backup tapes anymore where sensitive data is involved. There are appliance-style products out there specifically for encrypting tape backups, if you can't figure out another way.
And I'm sure there are plenty of SW solutions also.
This kind of crap has been happening too often.
I hate to say we need a law, but we need a law.
I work for a company that designs and builds devices used in the medical industry. If we use a third party for hardware or software, we have to verify and vouch for that software. If a patient gets hurt because some 3rd party app did something wrong, the 3rd party doesn't get sued, we do. It should be the same for personal data. Ameritrade should have made sure the data was secure, whether it was in their hands or not. If anyone's identity gets stolen, or they get ripped off in any other way, Ameritrade should be liable for the loss plus damages! As should all of the other companies that are losing personal data.
the only solution is the eradication, entirely, of the notion of 'personal data'. by that, i mean: you personally should be recording everything, not just the company. both sides should have their full records, for there to be 'fairness'.
until there is such a common, accepted, standardized practice, there will always be a mis-balance of corporate-Entity(knowledge of individuals) versus indepent-Entity(knowledge of corporate state). the reason we hate big brother is because we have no control over him; we'd accept his conditions, if turnabout was enforced by the state, and we had just as much public oversight of government as 'it' does 'us'.
from now on, simply record every single thing you do, anything thats a part of an agreement made with some company, yourself. save every single thing 'they' print you, put it in your system so that you data-mine them. use your digital prowess to record as much of your 'person->corporation' interaction as possible.
do it for a year, and then see how you feel about corporate loss of data.
its an odd thing, but in fact total-awareness is the only solution to problems of individual privacy versus corporate responsibility. its a wry old universe, doing the irony thing again..
; -- the corruption of government starts with its secrets. a truly free people keep no secrets. --
Just gave them a call to close my account and I must say that they (or at least the person I talked to) was well versed on the talking points from the press release.
1) Blame third party
2) Data is not lost, we just don't know where it is
3) There has been no evidence of the data being used
The woman I spoke with was pretty adamant about making these points and really tried to keep me from closing my account.
I am not sure if this sort of revelation usually results in a significant loss of business or not, but it would appear they were well prepared to rebut peoples concerns.
"Oh, you hate your job? There's a support group for that, it's called everyone, they meet at the bar."
I work with eCommerce for a living. Credit card processing requires the CC#, Exp date, CVV2 code (the digits on the back of the card) and the billing Zipcode.
Why then must we supply name, address, phone number, email, and other personal information just to make a purchase? (obvious answer is for customer profiling and contacting post-sale.)
I try to refuse to provide a SSN whenever I recocgize it isn't needed (like to establish an account at the local dry cleaners) but so often, employees become adjitated, as if I am trying to hide something.
We as consumers need to do more to protect our own personal data from getting to 3rd parties in the first place.
Now obviously Ameritrade needs such financial and personally identifying information for SEC and IRS compliance, but in that case, they should be required by an oversight body to protect that information.
HIPPA protects the privacy rights of US citizens healthcare information and has two very important rules:
(1) information must be secured
(2) only the minimal information may be collected when required and only the minimal information may be shared with those who require it.
Why doesn't this exist for SSN, bank account numbers, etc?
I only came here to do two things; kick some ass, and drink some beer...looks like we're almost out of beer.
"this was not an Ameritrade Systems issue or a compromise of our technology. This was related to a third party vendor."
I'm so peeved when I see comments like this. When will people realize that when they hire a 3rd party vendor to complete a task they are not absolved of responsibility. This IS an Ameritrade Systems issue. They didn't encrypt their data. They didn't hire a responsible shipper. They still "own" the issue.
I did technical account management for years. One thing our group was primarily responsible for was saying "Yes, this is our issue, we will see it to resolution". Even when the blunder was caused by a 3rd party, we owned it. It was our responsibility.
Dear Sir,
Recently, we were sending all of the money in your account to another branch and, well, it got lost on the way. Sorry, shit happens.
Sincerely,
Your Bank
mp3's are only for those with bad memories
(i) The member, broker, or dealer must notify its examining authority designated pursuant to section 17(d) of the Act (15 U.S.C. 78q(d)) prior to employing electronic storage media. If employing any electronic storage media other than optical disk technology (including CD-ROM), the member, broker, or dealer must notify its designated examining authority at least 90 days prior to employing such storage media. In either case, the member, broker, or dealer must provide its own representation or one from the storage medium vendor or other third party with appropriate expertise that the selected storage media meets the conditions set forth in this paragraph (f)(2).
(ii) The electronic storage media must:
(A) Preserve the records exclusively in a non-rewriteable, non-erasable format;
(B) Verify automatically the quality and accuracy of the storage media recording process;
(C) Serialize the original and, if applicable, duplicate units of storage media, and time-date for the required period of retention the information placed on such electronic storage media; and
(D) Have the capacity to readily download indexes and records preserved on the electronic storage media to any medium acceptable under this paragraph (f) as required by the Commission or the self-regulatory organizations of which the member, broker, or dealer is a member.
Brokers are required to use a storage medium where tampering is evident. Once that was bound ledger books written in ink. Later, it was bound books of computer printouts. Then it was microfiche. Today, it's CD-ROM or DVD-ROM. But not magnetic tape. Not even for backup.
And if a securities firm outsources some of its back office operations, the outsourcing firm has to make certain filings with the SEC:
-
(i) If the records required to be maintained and preserved pursuant to the provisions of Sec.Sec. 240.17a-3 and 240.17a-4 are prepared or maintained by an outside service bureau, depository, bank which does not operate pursuant to Sec. 240.17a-3(b)(2), or other recordkeeping service on behalf of the member, broker or dealer required to maintain and preserve such records, such outside entity shall file with the Commission a written undertaking in form acceptable to the Commission, signed by a duly authorized person, to the effect that such records are the property of the member, broker or dealer required to maintain and preserve such records and will be surrendered promptly on request of the member, broker or dealer and including the following provision
...
Ameritrade needs to address these issues. As a broker, they are not allowed to be casual about record-keeping.1. There are algorithms that are designed for realtime encryption, i.e. twofish. 2. There is special hardware that can perform encryption/decryption much more efficiently than your general-purpose CPU. Just because microsoft backup doesn't support encryption doesn't mean that any serious backup software won't do it. If your backup software/system doesn't support encryption, it was designed for home-users (despite what it claims). When the market demands encryption, software vendors will step up. Or maybe I should say "if".
Good point. ;)
What you are quoting are the rules for archival storage of information (that is the rule that requires orginasations to store for 6 years data relating to their transactions for compliance purposes.) This does not apply to all information retained by brokers (but to specific transactional related data), and it most certainly does not apply to regular backup procedures