Stay on top of the latest tech news with our free IT News Digest newsletter, delivered each weekday.
Automatically sign up today!


Robert Lemos

Staff Writer, CNET

A “small” number of backup tapes with records detailing the
financial information of government employees were lost in shipment to a backup center, Bank of America said on Friday.

The tapes contained information on the customers and accounts of the U.S. government’s SmartPay charge card program, which has more than 2.1 million members and annual transactions totaling more than $21 billion, according to the General Services Administration. Reports have pegged the number of cards affected at 1.2 million.

“Federal law enforcement officials were immediately engaged when the tapes were discovered missing, and subsequently conducted a thorough investigation into the matter, working closely with Bank of America,” the bank said in a statement. “The investigation to date has found no evidence to suggest the tapes or their content have been accessed or misused, and the tapes are now presumed lost.”

The acknowledgment comes as several other cases of businesses losing consumer information have come to light. Last week, data collection company ChoicePoint announced that it had given information on approximately 150,000 subscribers to about 50 fake business fronts created by fraudsters.

This week, payroll processor PayMaxx acknowledged that a flaw had left some of its customers’ W-2 forms accessible to the Internet. And cell phone service provider T-Mobile has dealt with ongoing security problems that have led to the publication of celebrity Paris Hilton’s personal information and the phone numbers of many Hollywood stars.

The loss of the SmartPay information could hurt Bank of America’s chances to renew its contract with the government, said Mark Amtower, a partner at Amtower, which advises businesses looking to market to the federal government.

“This is extraordinarily valuable information,” he said. “It will definitely hurt (Bank of America) in the recompete.”

Bank of America said it will continue to monitor the accounts on the data tapes and will contact the government cardholders if any unusual activity is observed.