Today, Scottrade Inc. announced a breach of 4.6 million customer contact information records (and possibly Social Security numbers), resulting from an attack that occurred between late 2013 and early 2014.
Scottrade told customers in an email that it had "not seen any fraudulent activity as a result of this incident." However, the company also stated that it learned about the breach from the FBI, which was investigating a rash of breaches involving financial services firms. The company says it has no reason to believe its trading platforms or client funds were compromised, and that the focus appears to have been contact data, possibly to facilitate stock scams.
"A concerning lack of detective capabilities must not have been in place to have missed data exfiltration to the tune of 4.6 million records," says Stewart Draper, director of insider threat at Securonix. "The timeline specified was a particularly sensitive time in this sector with hacktivist and criminal groups regularly targeting financial companies. Federal authorities should not be the avenue with which companies are discovering they may have been breached. In 2014 Scottrade was fined for failure to provide complete trade logs, blamed on an internal IT error from a migration. Accountability for these mistakes need to be taken at the highest levels of the organization to help drive awareness and improvement in security defense."
"The FBI is unlikely to explain in detail why notification of this breach took so long, but it's not uncommon for an ongoing investigation to delay notification so that criminals aren't tipped off," Tim Erlin, director of IT security and risk strategy at Tripwire.
A Scottrade representative told Wired that the FBI informed them of the breach in August but did ask them to withhold the information from customers until last Friday while they completed a part of the investigtion.
"Cyber criminals behave more like an infestation than the usual metaphor of a burglar," says Erlin. "Once they're inside, it takes more than a rolled-up newspaper to get rid of them."
"Scottrade customers are in the dark about exactly what was taken (the names and addresses were provided by Federal law enforcement), and don’t yet know where the data was taken from," says Trey Ford, global security strategist at Rapid7. "What we do know is that the data appears to have been taken 18-24 months ago. Few, if any, organizations store log data reaching that far back and it’s no wonder Scottrade cannot definitively state what data was taken for this reason."