Failure to encrypt results in EPIC breach

Sometime in the evening of July 16 or the early morning hours of July 17, burglars managed to steal five laptop computers from the offices of Edgewood Partners Insurance Center (EPIC) in San Francisco.  The theft was discovered on the 17th and reported to the police, but as of September 6, the laptops – one of which contained personally identifiable information  – have not been recovered.

In a letter to those affected, Daniel J. Crawford, Executive Vice-President and General Counsel, informed recipients that the unencrypted information on the laptop included information of current and former employees and their beneficiaries and dependents, as well as information concerning independent contractors, employees of related companies, companies for whom Edgewood provides human resources functions, and job applicants to Edgewood, related companies, and companies for whom Edgewood provides human resources functions.

Although the laptop was password-protected, the data were not encrypted. For dependents and beneficiaries, the unencrypted information included names, addresses dates of birth, Social Security numbers, benefits information, and limited health information. For job applicants, the information included names, addresses, and driver’s license numbers.  For employees, contractors, and employees of firms for whom Edgewood provides human resources functions, the information included a combination of names, addresses, dates of birth, Social Security numbers, driver’s license numbers, benefits information, and in some cases, limited financial or bank information  or limited health information.

The total number of employees, contractors, beneficiaries, and dependents being notified was not disclosed.  Recipients were offered a year of free credit monitoring, or for minors, a service from Experian that would check to determine if any credit report was available in their name. Since minors should not have credit reports, finding one might indicate that the minor’s information had been been misused.

Copies of the  notification letters were posted on the California Attorney General’s web site today.

In the wake of the burglary, the company indicated that it would be making some security improvements within the next 30 days, including encrypting all laptops.

And yes, it’s somewhat ironic that a firm that helps clients manage risk did not do a better job of managing risk in its own environment, but there you have it.


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