TELECOM Digest OnLine - Sorted: LexisNexis Uncovers More Consumer Data Breaches

LexisNexis Uncovers More Consumer Data Breaches

Lisa Minter (
12 Apr 2005 14:48:35 -0700

WASHINGTON (Reuters) - Data broker LexisNexis said on Tuesday that
identity thieves have stolen information on 310,000 U.S. citizens from
its computer systems, 10 times more than its initial estimate last

Thieves have used stolen passwords to lift Social Security numbers and
other information from LexisNexis databases 59 times over the past two
years, the company said.

Several similar incidents recently have prompted calls for greater
regulation of companies that can create comprehensive profiles of
nearly every adult in the United States.

"When a company like LexisNexis so badly underestimates its own ID
theft breaches, it is clear that things are totally out of hand," said
New York Democratic Sen. Charles Schumer.

Identity theft costs U.S. consumers and businesses $50 billion
annually, according to government estimates.

After sending out letters to 32,000 people in March, LexisNexis will
notify an additional 278,000 individuals whose profiles were accessed.

The company, which is owned by Anglo-Dutch publisher Reed Elsevier
(REL.L) (ELSN.AS), said it will improve its security measures and make
sensitive information less freely available.

The information accessed included names, addresses, Social Security
numbers and driver's license numbers, but not credit histories,
medical records or financial information, LexisNexis said.

LexisNexis said it has found no instances of identity theft among the
roughly 600 people who have asked it to check their credit records so

A spokesman declined to elaborate on the breach, as the company and
Secret Service are currently investigating.


Nearly all of the 59 incidents going back to January 2003 occurred at
Seisint, a subsidiary based in Boca Raton, Florida that has drawn
criticism from civil-liberties groups.

One Seisint database called the Matrix allows state law enforcers to
quickly zero in on criminal suspects by sifting through vast amounts
personal information -- from the color of someone's eyes to the type
of car they drive.

LexisNexis bought Seisint in July 2004.

Rival data broker ChoicePoint Inc. in February announced that
identity thieves had gained access to some 145,000 consumer profiles,
while Bank of America said that same month that it had lost a shipment
containing sensitive details of 1.2 million U.S. government customers.

LexisNexis CEO Kurt Sanford is scheduled to appear before the Senate
Committee on Wednesday, along with ChoicePoint and Acxiom Corp.,
another data broker.

"We need to examine how to ensure that security practices meet
appropriate standards of care," said Vermont Sen. Patrick Leahy, the
committee's top Democrat.

Also on Tuesday, Schumer and Florida Democratic Sen. Bill Nelson
introduced a bill that would require data brokers to tighten security
measures and notify consumers when a security breach places them at
risk for identity theft.

The Republican chairman of the House Energy and Commerce Committee,
Rep. Joe Barton of Texas, said he is considering legislation that
would make it illegal to sell Social Security numbers without an
individual's permission.

Reed Elsevier moved to soothe investors' fears by reaffirming its
earnings forecasts, saying the financial implications of the breach
were expected to be manageable within the context of LexisNexis's
overall growth.

Its shares closed down more than 1 percent in London and Amsterdam.

(Additional reporting by Bill Rigby in New York, Adam Pasick in London
and Theo Kolker in Amsterdam)

Copyright 2005 Reuters Limited.

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