Sometime last year computers at the U.S. Social Security Administration were hacked and the identities of millions of Americans were compromised. What, you didn’t hear about that? Nobody did.
The extent of damage is only just now coming to light in the form of millions of false 2011 income tax returns filed in the names of people currently receiving Social Security benefits. That includes a very large number of elderly and disabled people who are ill-equipped to recognize or fight the problem. It’s an impact pervasive enough that the IRS now has a form just to deal with it: Form 14039: Identity Theft Affidavit, December 2011.
The Wall $treet Journal has a story about this problem specific to Puerto Rico, but the Journal fails to mention that this is a national problem — a $30+ billion problem.
The story is going public now because tax season is upon us and there’s no way to keep it under wraps as people file their tax returns only to learn that a return under that name has already been filed with refunds paid electronically into a bank account now closed. The December date on that IRS Form 14039 shows the Treasury has been expecting this for awhile.
The question being asked about this in Washington, DC today is whether this hack was an act of war? More likely an act of Tony Soprano, I’d say. If the goal of war is to sow confusion and discontent, then okay, maybe China or Iran are behind this (you don’t have to be a superpower to take on the U.S. government anymore). But the more probable goal is simply to steal money and that’s a domestic job.
Either way, that big hacker score guys like me have been predicting for several years has finally happened with draconian policy changes sure to follow. Lucky us.
Probably a lead-pipe cinch that proposed solutions do more to show government’s on the job than fix the problem.
The Scorched Earth Party is overdue for a comeback.
Ah, Tim, I see you have met our friends at the TSA…
…who spend $60 billion of tax payer money each year to catch exactly zero terrorists.
While it’s hard to prove they prevented another 9/11, that has been their goal and excuse for existance. At least they helped make travel (a useless, wasteful process) less desirable except when absolutely necessary.
The TSA has found during secondary screening, thousands of Americans with outstanding warrants. It could be for something as simple as an unpaid traffic ticket. They will turn you over the Police and use your arrest to justify the need to expand their mandate to take over train stations, ferries, highways, sporting games.
The TSA regularly fails to find weapons placed in luggage to test TSA screening procedures.
Last year at least 65 TSA agents were arrested for stealing passenger’s luggage. Since 2001, 500 agents have been arrested or suspended for theft of passenger luggage.
Agents have been arrested for taking bribes from drug traffickers. The same people the TSA is supposed to stop. If drug dealers can bribe them, what about people with a more sinister agenda?
I’m digressing from the article, but if ever an agency needed to be scrapped, this is the one.
The problem is what to replace it with. Even if it were privatized, the government (taxpayers) would have to accept the liability for another 9/11, thus removing the incentive for doing a good job in an efficient manner.
Get the FEDERAL GOVERNMENT out of private enterprise. If the airlines were given the responsibility to protect their passengers, I betcha the airlines will do an excellent job and not cost the taxpayers a dime and the security would be enhanced 1000% in a few months!
The FEDERAL GOVERNMENT can’t provide affordable health care, affordable clean energy, automobiles, responsible banks, border security, entitlements, etc. The only thing that the FEDS have done recently has been protecting the homeland, increasing food stamps and increase the welfare rolls for Americans AND illegal aliens.
Well then I guess it’s achieving its intended purpose – which sure ain’t to catch “terrorists” but rather to monitor the American public.
Another reason to file early in the year
I’m safe. I received my $37 refund with no problems.
On the other hand, I received an email supposedly from the US Postal Service confirming my order of three prepaid postal coupons for $34 to be charged to my credit card account. I wonder if whoever this is actually has my credit card info.
Isn’t there an easy fix that would prevent the mass retrieval of sensitive data? Okay, let’s assume they break in somehow. Can’t there still be safeguards against massive actions — like reading or retrieving gobs of data. Something like this certainly should not be normal.
I would think that for these highly sensitive computer installations they could have customized hardware with rules (like the three rules for robots) that could not be overridden by anyone, whether from internal or external contact.
You’re hardly “safe.” By my crude estimation, your personal share of $30B is roughly $108, making a sizable net loss.
Yes, Rob. However, when the US defaults on its debts (either directly or through massive inflation), my share of the loss will disappear into the night.
Of course with “massive inflation,” that $37 isn’t going to buy you squat. You’re not making me feel safe, Charlie.
Rob — If you want to feel safe, read my article at:
http://ezinearticles.com/?Surviving-Bad-Times—The-Steps-That-Can-Keep-You-Safe&id=691767
Oops — that should have been:
http://ezinearticles.com/?Surviving-Bad-Times—The-Steps-That-Can-Keep-You-Safe&id=6971767
Enjoy your $37, and your false sense of security.
Strangely enough, I received a Southwest Airlines RapidRewards credit card at my house in the name of the women I had purchased it from 7 years earlier. I also received a letter from Best Buy saying she was denied credit.
I wonder if the SS file had old data in it? Maybe from a backup tape?
“I received a Southwest Airlines RapidRewards credit card at my house in the name of the women I had purchased it from 7 years earlier. I also received a letter from Best Buy saying she was denied credit.”
How did you know what these letters addressed to someone else said?
Opening someone else’s mail is a federal offense which can be punishable with a fine and possible incarceration or both, depending on the type, severity, and court discretion.
No it’s not.
You can open anything delivered to your house.
Actually, I didn’t open it, I ripped it in 1/2 like I do all of the credit card offers I get in the mail. It was as I was throwing it in the trash a credit card fell out.
They fraud guy at the card company told me to cut the card in 1/2 and throw it away.
bogus credit for an ex, you say.
more likely you should have taken the letter and bad card to the postal inspectors office, get the ex put in stir on federal mail fraud charges, and put inquiry holds on your files at the three credit bureaus.
run your credit history now on the three bureaus, and pay for a FICO… and submit corrections requests as appropriate.
my wife’s ex (or the skank he took up with) tried pulling that on two kids and the wife. the wife maintained a post office box for a couple years as a trap for further issues, and I unsubtly passed the word talking with a couple of the kids that if I got punked, the sheriff would be the second person in the world to know about it.
so far, so good.
I think we all should file IRS form 14039, describing our potential victim status. At least we’d be on the front side of the sure-to-come identify verification that Robert is alluding to.
Great article. Thanks for the info though I’m a bit late to read it but it’s still useful. If anyone needs blank form 14039, I found this site PDFfiller where you can fill out the IRS Services Forms that you need. Here is a link to the form that I was able to fill out http://goo.gl/mxT518. This site also has some tutorials on how to fill it out and a various blank forms in case you need to fill out one.
I think I liked the IRS better when their computers were so old they still used punch cards.
Yea, taxes were lower then.
No, taxes were higher then.
P.S. “Father Knows Best” was not a documentary.
They were lower then
Actually, taxes for the rich were much higher in the 50’s and 60’s. They didn’t need tax breaks to create jobs.
They were higher then. Our Federal taxes are the lowest they’ve been since the end of the Second World War.
Of course, back then GE actually paid Federal taxes.
Remember all this when people talk about us being overtaxed.
I think it depends on one’s individual circumstances. “Rich” and “poor” are extremes that are irrelevant in the the production of real tax revenue since so few people are actually included in either category. Politicians use those terms to hide their true purpose which is simply to get as much money from us as possible. So I said taxes were lower simply because they seemed so when I was young and unaware. Regan helped lower them briefly until the government expanded inflation and made us all “richer”. They also created the idea of disallowing real losses to make us appear “rich” on the tax form only (e.g AMT and also the categorizing of income types to prevent losses from offsetting profits).
Taxes were in fact lower for anyone with a decent accountant or tax attorney. Top rates were nominally higher but the code was riddled with loopholes making it easy to shelter income.
This is scary. When we went to file our tax return the system said that my wife had already filed. We had to send our joint tax return trough regular mail and we’re waiting to hear from the IRS still.
♩♪♫♬ Awkward… ♫♬ ♩♪
how do you hide 30,000,000,000 in cash Undetected
It’s pretty brilliant. What it does is where there’s a bank transaction, and the interests are computed in the thousands a day in fractions of a cent, which it usually rounds off. What this does is it takes those remainders and puts it into your account.
Hey, didn’t they use that scheme in Superman III?
It -is- a movie quote, but you have the wrong one.
https://www.imdb.com/title/tt0102578/
If you had watched the movie you quoted, you would know that the Superman 3 comment was from Office Space also.
Underrated movie, actually.
Superman 3?
(j/k)
After all, it’s only half the amount lost to music piracy: https://www.ted.com/talks/rob_reid_the_8_billion_ipod.html
When you have lots of small transactions (e.g. sub $10k) you can easily transfer them electronically to an off-shore bank where i no longer matters whether you hide it or not. one or more routing and combination stops may be along the way. Either way, it doesn’t take much to see that if planned well, the money could become very hard to track down in the end.
Looks like the IT at Social Security Administration is too busy just keeping the data center up, then do any cyber security.
http://itknowledgeexchange.techtarget.com/business-technology/lessons-social-security-administration-facing-data-center-failure/
Also, Looks like the IRS saw it coming back in May 2011.
http://blogs.reuters.com/reuters-money/2011/05/27/irs-sees-staggering-jump-in-identity-theft-cases/
Oh well, rather then the goverment fix the problem, it is easier to just rase taxes 30 billion!
Gee, I wonder if our refusal to raise taxes has anything to do with the problems you describe.
If the government had less money, there would be less to steel from it.
Or maybe they won’t be able to assign resources to deal with the problem in the first place.
Businesses are good at that sort of thing: rather than invest in actually preventing security breaches, they’d prefer to run as lean as possible and pat themselves on the back for saving money. Until the breach happens, as it always does, and then they’re good at pointing fingers.
Assigning resources is a business decision that works when you have a “bottom line” to worry about. If their is no such concern, there is nothing to prevent the missallocation of resources. Hence, the less we give them, the less they can squander.
Believe me, the bottom line is rarely invoked for things such as this. More often than not it’s the “big bonus” carrot instead.
Besides, the government is the only place I’ve ever seen a scenario where the “you didn’t have enough resources to prevent XXX, so we’re going to slash your budget instead!” argument gets played. The presumption is, of course, that all governments have bloat. The thing is, a government is not a business, so trying to use the “run it like a business!” is a non-sequitur. (If it were a business, the first thing they’d do is cut R&D, education, and infrastructure, just like any other business does to save a quick buck.)
Actually the fed just prints money and gives it to dot gov, which spends nearly twice what it collects in taxes.
Who cares if it’s $30 billion or $30 trillion? It’ll all just get wiped out one day when the gov is forced into default.
Though the intrusion incidence is sure condemnable.
Loved the line “you don’t have to be a superpower to take on the U.S. government anymore”. Hope the planet bully finds so more often 🙂
Hopefully, this will finally stop the water company, gas company, electric company, Blockbuster, etc. from using Social Security numbers as the prime identifiers.
Everyone should have a Passport Card and use the number on that. It’s so much more insanely secure than this stupid piece of paper we’re supposed to wander about with and present for official functions throughout our life.
Amen to that!!!!! I credit card companies as well –
Credit reporting companies are in big trouble.
Hey, I have an idea. Let’s get these geniuses at the SSA to run our damn health care system, too. Fantastic! What could possibly go wrong?
Couldn’t be any worse than UHC or Blue Cross.
Actually I’d prefer the VA or Medicare run it, they provide excellent care and their overhead is 3%, not 10-15% like the for-profits.
It’s weird how we’re told that we have the best healthcare in the world, AND its costs are out of control so it must be destroyed. Our military and Congress have single-payer healthcare that is cost-effective, AND single-payer is socialistic nanny-state government intervention that not only can’t work but will turn the country into a Marxist dictatorship.
Yeah, no. I’m Canadian, so I know what you’re in for. We have the best health care in the world. It’s actually better than yours in the US. If you can get it. Because it’s rationed. multiple cancers? Six months for an assessment. Unless you’re in parliament, or know someone.
Don’t do it, folks. You’ll regret it.
I’m sure there are plenty of other places to talk about healthcare… let’s stay on topic here.
As a Canadian who worked down in the U.S. should I be concerned that my American SSN might be targeted? I haven’t used it for 5+ years now… but like the Puerto Ricans might not get attention for it re-appearing after a break and start claiming tax refunds.
… I guess it wouldn’t hurt to contact the IRS. Is there a handy website to check status of your SSN somehow… if only to see if it’s active?
You probably don’t have a real SS number. If it starts with a 9, its not.
Nope, it does not start with a ‘9’.
It was and can be used to file tax returns and get resulting refunds. Valid for work only with INS authorization. I would hope their computers are connected but I have my doubts.
I received “free” healthcare from the military for more than 23 years, and was a medical department officer in one of the services. While the healthcare was free, it had a lot of problems. It relied heavily on $ (lots and lots of $) from DoD (i.e., from the taxpayer) to keep quality at an acceptable level using advances (drugs, medical devices, etc.) and improved treatments developed in the non-government healthcare sector. The overhead was extremely high (lots of administrators, and many very unproductive people supporting a relatively small number of healthcare providers), so I would like to know who is saying that the overhead is as low as you state for government programs. The military medical system can’t recruit specialists in high-paid fields (e.g., orthopedic surgeons), so very expensive residency programs are maintained to “grow their own.” This adds to the overhead, and with a single payer system that will not pay market wages to people like this you would see a further erosion in quality as our best and brightest pick other fields where they can be fairly paid.
The single biggest problem that I had with my free healthcare was that of very uneven quality. At some clinics where a provider took pride in his/her craft you would receive high quality care, while in the majority of cases the healthcare provider seeing you just wanted to get your medical record out of his/her inbox so he or she could go home in the evening.
[…] don’t worry, ObamaCare won’t be like that. Via I, Cringely » Blog Archive The $30 billion Social Security hack – I, Cringely – Cringel…. This entry was posted in Government, Security. Bookmark the permalink. ← This Job Is […]
[…] Bono? Posted on March 31, 2012 2:46 pm by SteveF The $30 billion Social Security hack Sometime last year computers at the U.S. Social Security Administration were hacked and the […]
[…] Fraud artists have broken into the US pension system database and have collected billions of dollars… […]
Come on, Cringe, where’s the sources and evidence? The WSJ article talks about general tax refund fraud, nothing about a massive SSA security breach. And where do you get the $30B number, out of your hat?
Form 14039 has existed for quite some time, it is NOT a direct response to any security breach. I’ve found references to it going back at least as far as 2007, and my wife who is a SSA employee says she’s seen it and referred people to it for at least that long.
This report is way too thin on supporting evidence to be able to take seriously; a disappointment considering what we’ve come to expect from you.
Well I’m flattered that you’ve come to expect better from me, Eric, but sometimes I just have to go with the story this way to protect my sources.
In this case it comes from people who from time to time work as consultants to the very government agencies currently running around as if their heads have been cut off because of this theft.
Think about it. The theft happened months ago and was quickly detected. What’s a government to do? Give everyone new Social Security Numbers? Revert to passport or other more secure numbers as some readers suggested? Or just hope the problem is smaller than you fear and try to find a way to contain it when shit starts hitting the fan?
Looks like Door Number Three to me.
Sounds like another Urban Legend. I’m not buying this story.
Suppose it’s the US government? I mean it’s an election year and they want to stimulate the economy. But how to get money circulating? They can’t give more to the banks, they’ll just horde it. How about letting criminals get it, through fraudulent refunds of small amounts on a large scale? Send out the real refunds too, so everyone is happy.
The real rate of inflation is running 13% according to General Mills (yes makers of breakfast cereal). Where is the money coming from to fuel that, and how is it getting into the circulation?
And that was in August 2008 according to the top Google hit: https://www.infowars.com/the-real-rate-of-inflation-is-13/
[…] I, Cringely » Blog Archive The $30 billion Social Security hack […]
Interesting story, and I respect that you can’t divulge your souces. However do you have any evidence for the following statement “computers at the U.S. Social Security Administration were hacked and the identities of millions of Americans were compromised”
Could it have been other computers containing SSN which were hacked. Belonging to other organizations perhaps? Or could it have been an inside leak rather than a hack.
instrumental…
[…]I, Cringely » Blog Archive The $30 billion Social Security hack – I, Cringely – Cringely on technology[…]…
[…] The $30 Billion Social Security Hack – I imagine that we will see a lot more of this in the future. […]
The e-fiile federal return for a friend of mine was rejected this past week because someone had previously filed using her SS #. The $30 bil may be an estimate of the amount of fraudulant refunds the crooks will be able to steal from the IRS. Sooner or later they will have to pay us law abiding citizens the true refund we’re owed.
I guess the IRS learned nothing from all the prisoners who were filing fradulant tax returns and clash for clunker rebates from their prison cells a few years ago.
[…] The $30 billion Social Security hack Cringley.com […]
I’m already a victim. I have a demand notice from the IRS for $5,000 for a tax form filed in another state. What government agency informed me that I was a victim of identity theft? You guessed it, the IRS.
The IRS can’t keep its own records straight between service centers.
The IRS has implemented a “PIN number” program to try and control this problem. The IRS will mail you a PIN number to add to your return as an additional form of identity confirmation.
[…] https://www.cringely.com/2012/03/the-30-billion-hack/ Print Friendly […]
Making Fraud less than profitable:
Increase taxation on all those who are convicted of crimes to help offset costs they impose on government.
.
http://wh.gov/UWn
.
Modify Patriot Act to provide ethical consistent control to both increase freedoms while increasing security:
.
https://wwws.whitehouse.gov/petitions/!/petition/modify-patriot-act-provide-ethical-consistent-control-both-increase-freedoms-while-increasing/wqBy8bcT
.
Re-evaluate all persons claiming Disability status, unless they are actively working.
.
https://wwws.whitehouse.gov/petitions/!/petition/re-evaluate-all-persons-claiming-disability-status-unless-they-are-actively-working/pDfl9dmQ
[…] https://www.cringely.com/2012/03/the-30-billion-hack/ Share this:FacebookShareDiggStumbleUponEmailRedditPrint […]
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[…]I, Cringely » Blog Archive The $30 billion Social Security hack – I, Cringely – Cringely on technology[…]…
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[…] computerized system secure? NOT!! How often do you think someone, somewhere hacks into the government website. I would say maybe regularly???? And don’t you think those same someones, might just hack […]
https://www.cringely.com/2012/03/30/the-30-billion-hack/
Turned out out be a slightly smaller problem?
From News of the Weird:
The Treasury Department’s inspector general reported in August that the IRS doled out more than $5 billion in fraudulent income tax returns in 2011 (owing to its mission to provide refunds promptly without first vetting the claims). The agency “refunded” $3.3 million to a single address in Lansing, Mich. (supposedly the home of 2,137 different tax filers) and nearly $4 million to three Florida addresses (518 to one in Tampa, 741 to one in Belle Glade, and 703 to a post office box in Orlando). In all, refunds were claimed by, among others, 105,000 dead people. [Associated Press via Washington Post, 8-2-2012; South Florida Sun-Sentinel, 8-6-2012]
Ou peut-on trouver la source exacte de cet article svp ? Merci 1000 fois ! bonne continuation.
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