The Data Theft Story That Keeps Changing

Written by Evan Schuman
June 6th, 2006

The current administration has a nasty habit of data trickle, where bad stories seem to get sharply worse every few days. Today’s contribution was the latest on the Veterans Affairs burglary that netted a laptop with lots of sensitive information on it.

Ever since last month’s burglary story broke, government officials have repeatedly adjusted the official story, as StorefrontBacktalk noted this weekend.

On Tuesday, the story was upgraded again citing that the personal data on some 2.2 million active-duty troops may have been exposed. That means, according to Reuters, that “nearly all current U.S. military personnel may be at risk for identify theft.”

A related data theft story involves Expedia’s loss of sensitive data when someone stole a laptop from a car. On Monday, Expedia had hired a PR firm to call reporters and stress that the incident was not in reality exposing its customers to identity thieves, but merely to credit card thieves.

Now there’s a comforting distinction. First, what does it say about Expedia that it not only felt that exposing customers to credit-card theft was a lot nicer than exposing them to identity thieves, but it was willing to pay money to try and make that difference clear?

Even better, one could make the argument that if you give a clever con artist sufficient access to a consumer’s credit card data, they will easily be able to extract enough personal data to try for an identity theft.

That all said, did either Expedia or the VA act recklessly? The lack of encryption suggests they might have. The Expedia person left the laptop in a car, which is certainly tempting fate.

After we wrote this weekend after being afraid to leave a laptop in a hotel room, a security consultant firm wrote to say they recommend clients leave the laptop, but to take with them the hard-drive. I have to admit that I like that idea, but am wondering how often I’d bother trying to unscrew the hard-disk and somehow carrying it with me.

Part of the problem here has little to do with data thieves. PDAs, laptops and other portable devices (such as these very cool tablet computers) are becoming expensive, easy to steal and easy to sell. The data on them may be worth millions to the victim but I am guessing most thieves will ignore it.

But all we need are a few thieves to not ignore it and we’ll have a very interesting nightmare.


Comments are closed.


StorefrontBacktalk delivers the latest retail technology news & analysis. Join more than 60,000 retail IT leaders who subscribe to our free weekly email. Sign up today!

Most Recent Comments

Why Did Gonzales Hackers Like European Cards So Much Better?

I am still unclear about the core point here-- why higher value of European cards. Supply and demand, yes, makes sense. But the fact that the cards were chip and pin (EMV) should make them less valuable because that demonstrably reduces the ability to use them fraudulently. Did the author mean that the chip and pin cards could be used in a country where EMV is not implemented--the US--and this mis-match make it easier to us them since the issuing banks may not have as robust anti-fraud controls as non-EMV banks because they assumed EMV would do the fraud prevention for them Read more...
Two possible reasons that I can think of and have seen in the past - 1) Cards issued by European banks when used online cross border don't usually support AVS checks. So, when a European card is used with a billing address that's in the US, an ecom merchant wouldn't necessarily know that the shipping zip code doesn't match the billing code. 2) Also, in offline chip countries the card determines whether or not a transaction is approved, not the issuer. In my experience, European issuers haven't developed the same checks on authorization requests as US issuers. So, these cards might be more valuable because they are more likely to get approved. Read more...
A smart card slot in terminals doesn't mean there is a reader or that the reader is activated. Then, activated reader or not, the U.S. processors don't have apps certified or ready to load into those terminals to accept and process smart card transactions just yet. Don't get your card(t) before the terminal (horse). Read more...
The marketplace does speak. More fraud capacity translates to higher value for the stolen data. Because nearly 100% of all US transactions are authorized online in real time, we have less fraud regardless of whether the card is Magstripe only or chip and PIn. Hence, $10 prices for US cards vs $25 for the European counterparts. Read more...
@David True. The European cards have both an EMV chip AND a mag stripe. Europeans may generally use the chip for their transactions, but the insecure stripe remains vulnerable to skimming, whether it be from a false front on an ATM or a dishonest waiter with a handheld skimmer. If their stripe is skimmed, the track data can still be cloned and used fraudulently in the United States. If European banks only detect fraud from 9-5 GMT, that might explain why American criminals prefer them over American bank issued cards, who have fraud detection in place 24x7. Read more...

Our apologies. Due to legal and security copyright issues, we can't facilitate the printing of Premium Content. If you absolutely need a hard copy, please contact customer service.