Is your data safe? How a high tech giant fell victim to low tech scamsters
“It was a simple scam”, says Russ Rosenberg, President of Asset Control. “You set up a bogus firm and mine for data under the guise of screening your own employees. I can’t see the scam having real legs unless the fraud artists set up multiple firms over a long period of time in order to enlarge the scope of the operation. If this is the case the scam could potentially affect tens of thousands of consumers or even more”, said Rosenberg. According to Bob Sullivan, MSNBC’s technology correspondent, about 50 fraudulent companies may have been identified so far. Additional media sources have recently reported that consumers in all 50 states may have been affected.
According to the industry’s own rule, each company would have had to provide specific documentation in order to show that the company was a legitimate business entity. “I can understand one or two companies slipping through the system" said Rosenberg, "and then only long enough for the documentation to be reviewed. If fifty companies slipped by ChoicePoint’s scrutiny then I would have to believe it to be something else other than a fluke. The sad part is that ChoicePoint is a security services company when it comes right down to it”.
If the infiltration was electronic you could almost understand it. In fact, fraud artists, hackers and various virus purveyors find ways around the protections put in place the most reputable of companies such as Microsoft and others. But in this case, con artists wheeled an entire herd of Trojan horses right into ChoicePoint’s client list. A rather unsophisticated maneuver but one the industry anticipated.
This is only the latest blunder, however. ChoicePoint has been on the hot seat before for security breaches that allowed millions of records containing personal identifying information to be sold via the internet, thus falling into unauthorized hands. In January 2000, the company was fired by the Pennsylvania Department of Transportation because it violated privacy / security stipulations in its contract. Because of the violation, the personal information of millions of Pennsylvania residents was offered for sale on the internet.
Hopefully, the FTC will apply the pressure where it is founded and not on the vast majority of smaller agencies that are just trying to do a good job for their clients. The likely result of all of this, says Rosenberg, is that the multitude of smaller employment screening agencies will be placed under stricter guidelines, making it even more difficult for firms to provide their clients with the products and services they need.