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T-Mobile: Employee Data Theft Leads To U.K.'s Largest Data Breach

Employee sold millions of customer records to data brokers, reports say
An employee of wireless service provider T-Mobile sold millions of customer database records to data brokers, leading to the biggest breach ever seen in the U.K., according to news reports.

The U.K. Information Commissioners Office (ICO), a British privacy watchdog organization, revealed yesterday that a mobile service operator had lost "thousands" of customer records sold by an employee who had access to the service provider's database. The employee, who no longer works at the service provider, earned "substantial sums" for selling the records, which were used by rival providers to get customers to switch services, the ICO says.

The ICO did not initially name the provider, but T-Mobile issued a statement earlier today:

"T-Mobile takes the protection of customer information seriously. When it became apparent that contract renewal information was being passed on to third parties without our knowledge, we alerted the [ICO].

"Working together, we identified the source of the breach, which led to the ICO conducting an extensive investigation which we believe we will lead to a prosecution. While it is deeply regrettable that customer information has been misappropriated in this way, we have proactively supported the ICO to help stamp out what is a problem for the whole industry."

T-Mobile had been asked by law enforcement to keep the incident quiet, but comments released to the BBC yesterday let the cat out of the bag, the statement says.

T-Mobile has been named in other data security scandals, most recently in August, when eight defendants were arraigned in a Brooklyn court for allegedly using the stolen identities of AT&T, T-Mobile, and Asurion customers to steal some $22 million worth of wireless equipment and services.

In June, a hacker claimed to have stolen a large amount of customer data from T-Mobile and then offered to sell it to the highest bidder.

According to a news report in London's Guardian newspaper, the employee allegedly sold the account information to a number of "brokers," who sold the data on to rival providers.

"The number of records involved runs into the millions, and it appears that substantial amounts of money changed hands," the ICO says. The data included customers' contract renewal dates, which make it easier for competitors to find prospective service switchers, the news reports say. The ICO says it had raided a number of premises and was preparing a prosecution file.

The ICO is pushing for breaches of data protection law to be punishable with jail sentences, not just fines, the news report says.

Steve Moyle, CTO of database security provider Secerno, agrees.

"The U.S. had a highly publicized case in which two employees of Countrywide Home Loans were prosecuted for illegally downloading and selling customer records," Moyle observes. "What makes this breach different is the large number of potential victims -- millions vs. Countrywide's thousands."

Moyle criticizes "the paltry sums that the offenders will be charged from violating the Data Security Act."

"The culprits will be charged thousands of pounds, which is not high enough to be a deterrent," Moyle says. "The fines need to match the severity of the crime and to reinforce the notion that stealing a person's information is a crime. These current fine amounts are not enough to do that, and the proof will come from the affected customers, who are likely to agree."

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