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Serco Quietly Announces Server Hack Affected Federal Retirement Plan

Serco Hacked

Serco Says Server Intrusion via "Sophisicated Cyber Attack" Affected Federal Retirement Plan

Serco, the contractor responsible for securing the personal and private information for millions of federal employees enrolled in the Thrift Savings Plan (TSP), quietly announced on that they had suffered a data breach last summer. The announcement was suspiciously made on Friday, just before the Memorial Day holiday.

When it comes to holidays or other notable dates, PR teams looking to pitch news or release important data will wait until after to do so, in order to ensure that reporters are available to cover the story, and that readers are there to actually see the headlines. The opposite is true as well, if you have to release information, but don’t want to make a fuss over it, it’s common to release it before a holiday or other important date, as people’s attention will be focused elsewhere.

In 2009, Heartland Payment Systems waited until the day of President Obama’s inauguration announce that they had suffered a data breach, exposing nearly 100 million accounts. The timing of the notification was questioned immediately. On Friday, just before the Memorial Day holiday, a holiday that plenty of federal employees are sure to enjoy, Serco Inc. announced a data breach that impacts their client, Federal Retirement Thrift Investment Board (FRTIB).

The FRTIB manages the TSP, which is a 401(k)-like retirement plan that is available to active and retired federal employees, in addition to other uniformed service personnel. This includes all branches of the U.S. Government, the U.S. Postal Service, and members of the armed forces. Currently, there are about 4.5 million TSP participants.

According to Serco, the data breach impacted approximately 123,000 TSP participants or other recipients of TSP payments. Internal auditing shows that 43,587 individuals had their personal information including name, address and Social Security number potentially compromised. On top of this, an additional 79,614 may have had their social security numbers compromised.

The term, "potentially compromised", is used to lessen the impact that the breach itself took place in July 2011. Add to this the fact that Serco remained unaware of the security incident until April 2012 when the FBI informed the firm it was breached.

The company further attempts to shift blame and play the victim card by adding that the breach “ an unfortunate reminder that Federal government and private company IT assets, computers and data are under pervasive, sophisticated attack.”

It’s not right to blame the victim, and Serco was the victim. Yet, it seems as if they were as much a victim of their own lack of forethought and process controls, than they were an external cyber attack.

None of their security controls detected the intrusion or unauthorized access, so there is no telling who has had access to the stolen data. In short, they’ve become a poster child for the Verizon Data Breach Investigations Report (VDBIR).

According to a press release, FRTIB will be sending notification letters today to all TSP participants and payees who may have been affected, adding that they have no reason to believe that the compromised records have been misused.

“Serco regrets this incident and the inconvenience it may cause to some Thrift Savings Plan participants and payees whose personal data was involved,” said Ed Casey, Chairman and Chief Executive Officer of Serco in a prepared statement.

More information is available here

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Steve Ragan is a security reporter and contributor for SecurityWeek. Prior to joining the journalism world in 2005, he spent 15 years as a freelance IT contractor focused on endpoint security and security training.