Posts Tagged: Shea Leordeanu


2
Oct 15

Scottrade Breach Hits 4.6 Million Customers

Welcome to Day 2 of Cybersecurity (Breach) Awareness Month! Today’s awareness lesson is brought to you by retail brokerage firm Scottrade Inc., which just disclosed a breach involving contact information and possibly Social Security numbers on 4.6 million customers.

scottradeIn an email sent today to customers, St. Louis-based Scottrade said it recently heard from federal law enforcement officials about crimes involving the theft of information from Scottrade and other financial services companies.

“Based upon our subsequent internal investigation coupled with information provided by the authorities, we believe a list of client names and street addresses was taken from our system,” the email notice reads. “Importantly, we have no reason to believe that Scottrade’s trading platforms or any client funds were compromised. All client passwords remained encrypted at all times and we have not seen any indication of fraudulent activity as a result of this incident.”

The notice said that although Social Security numbers, email addresses and other sensitive data were contained in the system accessed, “it appears that contact information was the focus of the incident.” The company said the unauthorized access appears to have occurred over a period between late 2013 and early 2014.

Asked about the context of the notification from federal law enforcement officials, Scottrade spokesperson Shea Leordeanu said the company couldn’t comment on the incident much more than the information included in its Web site notice about the attack. But she did say that Scottrade learned about the data theft from the FBI, and that the company is working with agents from FBI field offices in Atlanta and New York. FBI officials could not be immediately reached for comment.

It may well be that the intruders were after Scottrade user data to facilitate stock scams, and that a spike in spam email for affected Scottrade customers will be the main fallout from this break-in.

In July 2015, prosecutors in Manhattan filed charges against five people — including some suspected of having played a role in the 2014 breach at JPMorgan Chase that exposed the contact information on more than 80 million consumers. The authorities in that investigation said they suspect that group sought to use email addresses stolen in the JPMorgan hacking to further stock manipulation schemes involving spam emails to pump up the price of otherwise worthless penny stocks.

Scottrade said despite the fact that it doesn’t believe Social Security numbers were stolen, the company is offering a year’s worth of free credit monitoring services to affected customers. Readers who are concerned about protecting their credit files from identity thieves should read How I Learned to Stop Worrying and Embrace the Security Freeze.