[ISN] Ernst & Young fails to disclose high-profile data loss

InfoSec News isn at c4i.org
Mon Feb 27 02:09:46 EST 2006


[If E&Y (or any business!) invested less than $50 in a little
physical security, stories like this would be less commonplace.
http://www.amazon.com/exec/obidos/ASIN/B00004Z6ON/c4iorg  -  WK]

By Ashlee Vance in Mountain View
25th February 2006

Exclusive Ernst and Young should go ahead and pony up for its own 
suite of transparency services. The accounting firm failed to disclose 
a high profile loss of customer data until being confronted by The 

Ernst and Young has lost a laptop containing data such as the social 
security numbers of its customers. One of the people affected by the 
data loss appears to be Sun Microsystems CEO Scott McNealy, who was 
notified that his social security number and personal information have 
been compromised. While pushing all out transparency for its 
customers, Ernst and Young failed to cop to the security breach until 
contacted by us.

"We deeply regret that a laptop containing confidential client 
information was stolen, in what appears to be a random act, from the 
locked car of one of our employees," said Ernst and Young spokesman 
Charles Perkins. "The security and confidentiality of our client 
information is of critical importance to us. The computer was 
password-protected, and we have no reason to believe the data itself 
was targeted or that the information was accessed by anyone. We are 
notifying those clients whose information was contained on the 

Ernst and Young declined to comment on whether or not McNealy was 

However, at lat week's RSA security conference, McNealy noted that he 
received an e-mail from an "anonymous partner" detailing a loss of his 
private data. "We determined that your name and social security number 
were among the data (lost)," the partner wrote to McNealy.

"This is an organization that we spend an enormous amount of money on 
to determine whether we are Sarbanes-Oxley compliant," McNealy said.

Digging through Sun's financial filings, you'll discover that Ernst 
and Young serves as the company's auditor and handles Sarbanes-Oxley 
consulting for Sun. A spokesman at Sun confirmed that Ernst and Young 
is still the company's auditor but declined to out the firm that lost 
McNealy's data.

It's difficult to determine how massive the Ernst and Young data loss 
was in this case. Although, today we learned that a Deloitte and 
Touche CD containing information on McAfee employees was left in an 
airline seat pocket, exposing the social security numbers of close to 
9,000 workers. Certainly, a laptop loss could be as damaging.

Ernst and Young declined to return our phone calls seeking more 
information about the breach and why it has "no reason to believe" the 
password could be cracked. It makes no mention of stronger security 
than simple password protection. The company only sent along the 
earlier statement.

Ernst and Young has littered its web site with transparency advice for 
customers. The company, however, failed to make a public notification 
of the data loss.

Such secrecy seems quite rich given the current climate surrounding 
security and the protection of customer data. One might ask how a 
company such as Ernst and Young can judge the transparency of Sun or 
other customers.

Then again, the accounting firm could just stick with the "You have no 
privacy. Get over it" line. ®

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