Information Security News: IRS tapes still lost at City Hall

[InfoSec News <alerts () infosecnews org>]

http://www.kansascity.com/mld/kansascity/news/local/16503886.htm

By LYNN HORSLEY
The Kansas City Star
Jan. 20, 2007

A high-ranking Kansas City official said Friday that the search for 
missing Internal Revenue Service computer tapes at City Hall has covered 
all the logical places without success.

Assistant City Manager Rich Noll said searchers are considering other 
possibilities in hopes that the tapes will turn up.

"I sincerely hope we can find them. Thats my objective and my duty," 
said Noll, who is aiding in the search for 26 computer tapes containing 
sensitive taxpayer information. We understand this is an important 
situation and want to do everything the IRS needs us to do.

The Kansas City Star disclosed Friday that city officials and special 
agents with the Treasury Departments inspector generals office were 
investigating the disappearance of a shipment of tapes that arrived at 
City Hall in August. Noll was apprised of the tapes disappearance in 
late December.

It is unclear when city officials became aware of their disappearance, 
but Noll said he thought some effort to find the tapes began in 
November.

Noll said he did not know whether any employee who might have had access 
to the tapes had left the citys employment in recent months. He also 
said he did not know whether officials had checked into that. Other city 
officials involved in the search either declined to comment or could not 
be reached.

The tapes were part of a regular information-sharing agreement between 
the IRS and the city. City officials use the federal tax-return 
information to enforce their collection of the 1 percent earnings tax, 
which is paid by people who live or work in Kansas City.

City officials and the IRS either were unwilling or unable to provide 
details on the number of taxpayers affected or what type of data was on 
the tapes. But the information that is routinely shared includes names, 
Social Security numbers and income information.

Noll reiterated that the tapes were written in an uncommon programming 
language and require special equipment that the city keeps locked away.

"It is not something you could just load onto your laptop," he said. But 
he conceded there was no guarantee that the information could not fall 
into the wrong hands.

The IRS has strict rules to guard against the misuse or unauthorized 
disclosure of confidential personal financial information. Kansas City 
has shared information with the IRS for years, and the IRS regularly 
audits the process to ensure the city has adequate inventory and 
security systems, said a person who is familiar with the procedure. 
Kansas City has been certified in the past, attesting to its adequate 
security measures.

Michael Devine, an IRS spokesman in St. Louis, said it was premature to 
speculate about whether the missing tapes would result in fines or 
prompt the termination of information sharing between the agency and the 
city. He would not comment on whether other cities had been fined when 
information was misplaced or stolen.

Devine also would not discuss whether taxpayers or businesses must be 
notified that the information is missing.

"We're hopeful the city will locate the tapes," he said.


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