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Lawsuit Filed Against IRS for Massive Cybersecurity Breach

September 9, 2015 – On August 25th, two taxpayers filed a lawsuit against the Internal Revenue Service (IRS), alleging that the agency “didn’t do enough to protect their personal information from hackers.” The plaintiffs are seeking class-action status for the lawsuit.

This doesn’t come as a surprise after the agency reported in late May that the tax return information of approximately 114,000 U.S. taxpayers had been illegally accessed by cyber criminals over the preceding four months.

Worse yet, it came to light that rather than the original 114,000 victims, there might have been as many as, and possibly upwards of, 600,000 people targeted, while 300,000 were confirmed victims of the hack.

In an age where cybersecurity is at the forefront of everyone’s minds, and should be at the forefront of a government agency’s mind, it’s particularly disconcerting to note the ease with which security researchers reportedly hacked into the IRS’s website back in March.

The plaintiffs have claimed that the illegal access of records was preventable. More information will be forthcoming on the lawsuit.

Sources

Williams, Kate Bo. “Taxpayers sue the IRS over data breach.” The Hill. Capitol Hill Publishing Corp., 25 August 2015. Web. 8 September 2015.

Lawder, David, Emily Stephenson, and Sandra Maler. “IRS says cyberattacks more extensive than previously thought.” Reuters. Reuters, 17 August 2015. Web. 8 September 2015.

User-Targeted Techniques Still Favored Among Cyber Hackers

September 8, 2015 – A recent article discussed the continued prevalence of “tried-and-true” techniques and methods used by cybercriminals to gain unlawful access to a victim’s information. A mid-year report released by the cyber risk intelligence solution provider, SurfWatch Labs noted that, “the most common enabler for cybercrime methods was user interaction points with websites, applications, accounts and endpoints - accounting for 77% of all evaluated cyber intelligence collected and analyzed by SurfWatch Labs.”

One would think that with the increasing sophistication of cybercrime capabilities, these methods would fall, outdated, to the wayside. However, attackers still appear to go after “soft targets,” exploiting the numerous decision-points faced by end-users when interacting with technology. SurfWatch cautioned financial institutions and other organizations with an online presence to treat cybersecurity concerns with the same urgency and importance as other aspects of risk and security.

This is important to keep in mind when another report has found that half of all federal employees access government email and documents from their personal smartphones and mobile devices.

The lack of emphasis on cybersecurity concerns is alarming at the commercial level, and dangerous at the government level, particularly when considering the array of tools a cybercriminal has access to in order to steal sensitive information. Human carelessness is just another tool to add to that belt.

Sources

Kelly, Erin. “Federal workers’ personal devices pose security risk.” USA Today. MSN News, 20 August 2015. Web. 25 August 2015.

Senior Scams and Elder Abuse Rampant

August 31, 2015 – Among the many concerns of the Consumer Financial Protection Bureau (CFPB) is the subject of elder financial abuse prevention. Back in July, Cordray indicated that the CFPB “will release an advisory later this year to help financial institutions prevent, recognize, and report financial abuse.” The CFPB recently launched state-specific guides for elder financial caregivers, which are needed due to differences in state laws and services, according to CFPB Director Richard Cordray. The CFPB has a page, with a variety of resources, referring to the financial protection of older Americans.

Even with this extra attention on an issue that is much bigger than most think, vulnerable seniors are consistently scammed out of hundreds of thousands of dollars every year. 

The 2010 Investor Protection Trust Elder Fraud Survey said one in five Americans over 65 has been victimized by a financial fraud and a 2011 MetLife Mature Market Institute study stated that financial exploitation costs seniors at least $2.9 billion annually. More recently, the San Francisco-based financial services firm, True Link Financial, released a report estimating that $36.5 billion is lost nationwide to elder financial abuse, with nearly 37% of seniors across the United States being affected by financial abuse in any five-year period. Without tens of thousands of baby boomers turning 65 every day in the United States, the problem is projected to get worse.

One of the ways that the CFPB and other financial authorities recommend assuaging the issue is for financial institutions and caregivers of those susceptible to abuse to watch for signs, including but not limited to:

  • Reviewing bills, bank statements, and Medicare/insurance Explanation of Benefit's (EOBs) on a regular basis
  • Title changes in real property or wills when a person is incapable of understanding nature of transaction
  • Suspicious withdrawals of cash or other unusual activity in bank accounts
  • Sudden "friends" with undue influence or control over a senior's decision-making

Edcomm Group Banker’s Academy seeks to help financial institutions and other organizations combat elder financial abuse. Raising awareness is important, and Banker’s Academy is prepared to assist with efficient eLearning delivery systems and informational course offerings, such as Elder Financial Abuse and Recognizing Elder Financial Abuse.

Sources

Thomas, Jeremy. “Senior scams: Financial elder abuse rampant and grossly underreported, prosecutors say.” Contra Costa Times News. Bay Area News Group, 12 August 2015. Web. 18 August 2015.

The Plunge Felt Around the World: Wall Street Panics After 1,000-Point Drop

August 25, 2015 – Yesterday, Wall Street experienced a history-making intraday point drop, its biggest ever as it dropped 1,089 points at the opening bell. According to Fox Business, by close of day, all three major U.S. averages were in correction territory, though well off session lows.

Traders raced into safe-haven assets as fears over the instability in China and other emerging markets mounted. Dubbed “Black Monday” in China, where Chinese stocks recorded their biggest slump in almost a decade, stock market jitters spread throughout the globe as stock markets in the United Kingdom, Germany, France, Italy, and Spain also plummeted. It was reported that China’s Shanghai Composite Index lost 8.5%. Japan, Korea, Hong Kong, and Australia all closed more than 4% down, while markets in Saudi Arabia, Dubai, Egypt, and Israel declined sharply.

Market analysts described the chaos as a “China-driven micro panic,” reporting that global equities have seen more than $5 trillion wiped from their value since China devalued its currency two weeks ago.

Some are calling the Black Monday panic irrational (the Dow managed to close with only a 195-point drop). Wall Street experts offered several reasons not to panic about the market’s downturn, but the lack of confidence among investors is troubling speculators, who began selling vulnerable assets.

According to Yahoo! Finance, Chinese stocks tumbled again this morning despite the rebound in other Asian markets, “as investors despaired at the lack of policy action from Beijing in response to recent data suggesting the downturn in the world’s second-largest economy is deepening.” Many analysts are predicting a continued deceleration, rather than a crash, for China’s economy, and are cautioning patience as companies reassure investors about the economy.

The overall effects, however, will ultimately be that investors will be more watchful with their investments, and many will perceive that caution as stunted growth. This market correction, however, is necessary every so often, as Chinese stocks have been wildly overvalued for a while.

Sources

“China’s ‘Black Monday’ felt on stock markets around the world.” News.com.AU. News.Com.AU, 25 August, 2015. Web. 25 August 2015.

South Africa’s Economy Unsettled in Changing Financial Climate

August 24, 2015 – Back in July, it was reported that the South African Reserve Bank (SARB) was hinting at a rate increase to curb inflationary pressures. One source commented, “The benchmark interest rate the Brics group nation is 5.75%, and if an increase materialises this week, it could be of 25 basis points margin. The SARB meeting is on 21-23 July and the announcement will be at the end of the meeting.” The SARB raised domestic rates for the first time in a year due to a weaker rand, which has declined nearly 10% against the dollar.

As of August, South Africa’s economy is facing a turbulent patch as financial policies are being complicated by interest rate normalisation in the United States and a slowdown in China’s growth.

Meanwhile, unemployment has been rising in South Africa over the past five years, and currently stands at a ten-year high of 34.9%. According to The Guardian, South Africa is “struggling to escape the effects of the global financial crisis and mining companies – one of South Africa’s key economic sectors – are laying off workers in response to falling commodity prices.”

Many are wondering how the economy of the nation is going to bounce back amidst the turmoil created in the wake of the changing financial climate, citing methods from attempting to solve the energy crisis to increasing tourism to revolutionizing small businesses. On August 17th, the African National Congress (ANC) backed a plan to split legislation governing the oil and gas industry from mining laws as the party begins a review of its policies in the effort to revamp its flailing economy.

Sources

“South Africa economy faces turbulence ahead: c.bank’s Kganyago.” Naija247News. Naija247News, 11 August 2015. Web. 17 August 2015.

 

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