Block, formerly known as Square, Confirms Cash App Data Breach

On April 4, 2022, Block, Inc. (the “Company”) announced that it recently determined that a former employee downloaded certain reports of its subsidiary Cash App Investing LLC (“Cash App Investing”) on December 10, 2021 that contained some U.S. customer information. While this employee had regular access to these reports as part of their past job responsibilities, in this instance these reports were accessed without permission after their employment ended.

The information in the reports included full name and brokerage account number (this is the unique identification number associated with a customer’s stock activity on Cash App Investing), and for some customers also included brokerage portfolio value, brokerage portfolio holdings and/or stock trading activity for one trading day.

The reports did not include usernames or passwords, Social Security numbers, date of birth, payment card information, addresses, bank account information, or any other personally identifiable information. They also did not include any security code, access code, or password used to access Cash App accounts. Other Cash App products and features (other than stock activity) and customers outside of the United States were not impacted.

Upon discovery, the Company and its outside counsel launched an investigation with the help of a leading forensics firm. Cash App Investing is contacting approximately 8.2 million current and former customers to provide them with information about this incident and sharing resources with them to answer their questions. The Company is also notifying the applicable regulatory authorities and has notified law enforcement.

The Company takes the security of information belonging to its customers very seriously and continues to review and strengthen administrative and technical safeguards to protect the information of its customers. Future costs associated with this incident are difficult to predict. Although the Company has not yet completed its investigation of the incident, based on its preliminary assessment and on the information currently known, the Company does not currently believe the incident will have a material impact on its business, operations, or financial results.

SEC event filing of Cash App data breachhttps://www.sec.gov/ix?doc=/Archives/edgar/data/0001512673/000119312522095215/d343042d8k.htm

FTC Takes Action Against CafePress for Data Breach Cover Up

March 15, 2022- Commission orders e-commerce platform to bolster data security and provide redress to small businesses.

The Federal Trade Commission today took action against online customized merchandise platform CafePress over allegations that it failed to secure consumers’ sensitive personal data and covered up a major breach. The FTC alleges that CafePress failed to implement reasonable security measures to protect sensitive information stored on its network, including plain text Social Security numbers, inadequately encrypted passwords, and answers to password reset questions. The Commission’s proposed order requires the company to bolster its data security and requires its former owner to pay a half million dollars to compensate small businesses.

“CafePress employed careless security practices and concealed multiple breaches from consumers,” said Samuel Levine, Director of the FTC’s Bureau of Consumer Protection. “These orders dial up accountability for lax security practices, requiring redress for small businesses that were harmed, and specific controls, like multi-factor authentication, to better safeguard personal information.”

In a complaint filed against Residual Pumpkin Entity, LLC, the former owner of CafePress, and PlanetArt, LLC, which bought CafePress in 2020, the FTC alleged that CafePress failed to implement reasonable security measures to protect the sensitive information of buyers and sellers stored on its network. In addition to storing Social Security numbers and password reset answers in clear, readable text, CafePress retained the data longer than was necessary. The company also failed to apply readily available protections against well-known threats and adequately respond to security incidents, the complaint alleged. As a result of its shoddy security practices, CafePress’ network was breached multiple times.

According to the complaint, a hacker exploited the company’s security failures in February 2019 to access millions of email addresses and passwords with weak encryption; millions of unencrypted names, physical addresses, and security questions and answers; more than 180,000 unencrypted Social Security numbers; and tens of thousands of partial payment card numbers and expiration dates. Some of the information was later found for sale on the Dark Web.

After being notified a month later that it had a security vulnerability and that hackers had obtained consumer data, CafePress patched the vulnerability but failed to properly investigate the breach for several months despite additional warnings, the complaint alleged. This included a warning in April 2019 from a foreign government, which notified the company that a hacker had illegally obtained CafePress customer account information and urged the company to notify affected customers. The company, however, withheld this essential information, and instead only told customers to reset their passwords as part of an update to its password policy.

The complaint alleges CafePress did not inform affected customers until September 2019—one month after the breach was reported widely. The company’s lax security practices, however, still left many consumers at risk. For example, the company continued to allow people to reset their passwords on the website by answering security questions associated with customer email addresses—the same information that had been previously stolen by hackers.

According to the complaint, CafePress was aware of problems with its data security prior to the 2019 data breach. Through at least January 2018, when CafePress determined that certain accounts of shopkeepers had been hacked, CafePress closed the accounts and charged the victims a $25 account closure fee. The company also experienced several malware infections to its network prior to the 2019 hack but failed to investigate the source of such attacks.

In addition to its security failures, the FTC alleged the company misled users by using consumer email addresses for marketing despite its promises that such information would only be used to fulfill orders consumers had placed.

As part of the proposed settlement, Residual Pumpkin and PlanetArt will be required to implement comprehensive information security programs that will address the problems that led to the data breaches at CafePress. This includes replacing inadequate authentication measures such as security questions with multi-factor authentication methods; minimizing the amount of data they collect and retain; and encrypting Social Security numbers.

In addition, the proposed settlement requires Residual Pumpkin to pay $500,000 in redress to victims of the data breaches. PlanetArt will be required to notify consumers whose personal information was accessed as a result of CafePress’s data breaches and provide specific information about how consumers can protect themselves. Both companies will be required to have a third party assess their information security programs and provide the Commission with a redacted copy of that assessment suitable for public disclosure.

The Commission voted 4-0 to issue the proposed administrative complaint and to accept the consent agreement with the companies.

The FTC will publish a description of the consent agreement package in the Federal Register soon. The agreement will be subject to public comment for 30 days after publication in the Federal Register after which the Commission will decide whether to make the proposed consent order final. Instructions for filing comments will appear in the published notice. Once processed, comments will be posted on Regulations.gov.

NOTE: The Commission issues an administrative complaint when it has “reason to believe” that the law has been or is being violated, and it appears to the Commission that a proceeding is in the public interest. When the Commission issues a consent order on a final basis, it carries the force of law with respect to future actions. Each violation of such an order may result in a civil penalty of up to $46,517.

https://www.ftc.gov/news-events/news/press-releases/2022/03/ftc-takes-action-against-cafepress-data-breach-cover

U.S. data breaches Q3 2021

Identity Theft Resource Center to Share Latest Data Breach Analysis with U.S. Senate Commerce Committee; Number of Data Breaches in 2021 Surpasses all of 2020

The number of data breach victims dramatically increased in Q3 2021 due to a series of data exposures during the quarter 

SAN DIEGO, October 6, 2021 – Today, the Identity Theft Resource Center® (ITRC), a nationally recognized nonprofit organization established to support victims of identity crime, released its U.S. data breach findings for the third quarter?(Q3)?of 2021. According to the data breach analysis,?the number of data breaches publicly-reported in the U.S. decreased nine (9) percent in Q3 2021 (446 breaches) compared to Q2 2021 (491 breaches). However, the number of data breaches through September 30, 2021 has exceeded the total number of events in Full-Year (FY) 2020 by 17 percent (1,291 breaches in 2021 compared to 1,108 breaches in 2020). The trendline continues to point to a record-breaking year for data compromises (the all-time high of 1,529 breaches was set in 2017). 

For Q3 2021, the number of data compromise victims (160 million) is higher than Q1 and Q2 2021 combined (121 million). The dramatic rise in victims is primarily due to a series of unsecured cloud databases, not data breaches. Also, the total number of cyberattack-related data compromises year-to-date (YTD) is up 27 percent compared to FY 2020. Phishing and Ransomware continue to be, far and away, the primary attack vectors. 

Download the ITRC’s 2021 Q3 Data Breach Analysis and Key Takeaways 

“While the total number of data breaches dropped slightly in Q3, we are only 238 data breaches away from tying the all-time record for data compromises in a single year,” said Eva Velasquez, President and CEO of the Identity Theft Resource Center. “It’s also interesting to note that the 1,111 data breaches from cyberattacks so far this year exceeds the total number of data compromises from all causes in 2020. Everyone needs to continue to practice good cyber-hygiene to protect themselves and their loved ones as these crimes continue to increase.” 

Other findings in the analysis include: 

  • There have been no publicly-reported data breaches to date in 2021 attributed to payment card skimming services.  
  • Some organizations and state agencies are not including specifics about data compromises or reporting them on a timely basis. One state has not posted a data breach notice since September 2020. 

Enhancing Data Security – U.S. Senate Committee Hearing – Oct. 6, 2021

The ITRC will testify before the U.S. Senate Committee on Commerce, Science & Transportation today to present the findings from our Q3 Data Breach Analysis. Watch the hearing on enhancing data security live at 10 a.m. EST/7 a.m. PST.  ITRC COO, James E. Lee, issued a written statement for the record as part of a hearing with the U.S. Senate Committee. 

For more information about recent data breaches, or?the increase in the number of?data breaches discussed in?the?latest?trend analysis, consumers and businesses should visit the ITRC’s data breach tracking tool,?notified.??? 

Anyone?can receive free support and guidance from a knowledgeable live-advisor by calling 888.400.5530 or visiting ?www.idtheftcenter.org to live-chat.?? 

About the Identity Theft Resource Center

Founded in 1999, the Identity Theft Resource Center® (ITRC)?is a?national?nonprofit organization established to empower and guide consumers, victims, business and government to minimize risk and mitigate the impact of identity compromise and crime.?Through public and private support, the ITRC provides no-cost victim assistance and consumer education through?its website?live-chat?idtheftcenter.org?and?toll-free phone number 888.400.5530.?The ITRC also?equips?consumers and businesses?with?information about recent data breaches through its data breach tracking tool,?notified.?The ITRC offers help to specific?populations, including?the?deaf/hard of?hearing and?blind/low?vision?communities.? 

Joint Statement by the Federal Bureau of Investigation (FBI), the Cybersecurity and Infrastructure Security Agency (CISA), and the Office of the Director of National Intelligence (ODNI)

Over the course of the past several days, the FBI, CISA, and ODNI have become aware of a significant and ongoing cybersecurity campaign. Pursuant to Presidential Policy Directive (PPD) 41, the FBI, CISA, and ODNI have formed a Cyber Unified Coordination Group (UCG) to coordinate a whole-of-government response to this significant cyber incident. The UCG is intended to unify the individual efforts of these agencies as they focus on their separate responsibilities. This is a developing situation, and while we continue to work to understand the full extent of this campaign, we know this compromise has affected networks within the federal government.

As the lead for threat response, the FBI is investigating and gathering intelligence in order to attribute, pursue, and disrupt the responsible threat actors. The FBI is engaging with known and suspected victims, and information gained through FBI’s efforts will provide indicators to network defenders and intelligence to our government partners to enable further action.

As the lead for asset response activities, CISA took immediate action and issued an Emergency Directive instructing federal civilian agencies to immediately disconnect or power down affected SolarWinds Orion products from their network. CISA remains in regular contact with our government, private sector and international partners, providing technical assistance upon request, and making needed information and resources available to help those affected recover quickly from this incident. CISA is engaging with our public and private stakeholders across the critical infrastructure community to ensure they understand their exposure and are taking steps to identify and mitigate any compromises.

As the lead for intelligence support and related activities, ODNI is helping to marshal all of the Intelligence Community’s relevant resources to support this effort and share information across the United States Government.

To report suspicious or criminal activity related to information found in this statement, contact your local FBI field office at https://www.fbi.gov/contact-us/field-offices. To request incident response resources or technical assistance related to this statement, visit https://www.us-cert.gov/report.

2020 Merchant Credit Card Data Breach List

Updated June 2020, not all inclusive. Is your business safe from a credit card data breach? The list below highlights some credit card data breaches and the primary cause at the time the data breach was announced. While malware reigns as a top cause of payment data breaches, employee theft is still a problem too. To make the list, typically companies are only listed if full card data is stolen.

Restaurants

January 2020- Landry’s owns over 600 popular American restaurants across the U.S., including Del Frisco’s Grill, Joe’s Crab Shack, Bubba Gump, Rainforest Café and more. This is the second data breach since 2016, a result a POS malware. Some waitstaff were accessing an old system with card swipers without end to end encryption. TIP: When updating systems, remove all old terminals from facility; leaving on site commonly leads to reuse. As a consumer, avoid any place that uses card swipers.

Retail & Ecommerce

January 2020: Hanna Andersson– online store malware Magecart in their Salesforce Commerce Cloud (previously known as Demandware). I loved this brand when my kids were growing up. Criminals are hacking into vulnerable e-commerce platforms used by online stores and inject malicious JavaScript-based scripts into checkout pages that collect the customers’ payment info and send it to attacker-controlled remote sites. This is an old problem that updated checkout code prevents.

March 18, 2020: TrueFire online store malware Magecart attack, stolen card numbers for 6 months. Ouch.

June 15, 2020: Claires online store only, Magecard attack. Uses Salesforce Commerce Cloud, previously known as Demandware. This appears to be a new twist on Magecart breach.

Technology

April 22, 2020 Paay, a NY card payments processor startup, left a database containing 2.5 million card transaction records accessible online without a password. The exposed payment transaction belonging to 15 to 20 merchants includes full plaintext credit card number, expiry date and the amount spent.

January 28, 2020 Cornerstone Payment Systems, Christian-friendly company that does “not process credit card transactions for morally objectionable businesses,” left online a database with customer payment transaction data. The database contained 6.7 million records since 2013, and was updating by the day. The database was not protected with a password, allowing anyone to look inside. While there was not full card data taken, I felt notable to list.

April 2020 nCourt runs two payment sites courtpay.org and utilitypay.org using a system called GovPSA. Only hashed data was stolen, but newsworthy because affected data was from a legacy system, which commonly have security issues. The first and last four digits were exposed with other card data from at least three years’ worth of transactions up to and including November 2019.

April 6, 2020: Key Ring, a digital wallet app, left stored customer data of 14 million users accessible in an unsecured database. Users store scans and photos of membership and loyalty cards to a digital folder in their mobile device. The exposed data includes names, full credit card details (including CVV numbers)

North Country Business Products (NCBP), a Minnesota-based provider of point-of-sale (POS) products, initial breach report roughly January 2, 2019 to January 25, though for most, the window is just a day or two. Mostly restaurants and small businesses, usually “level 4” merchants requiring a a PCI Council Qualified Integrators and Resellers for Point of Sale installation. QIRs are integrators and resellers specially trained by PCI Security Standards Council to address critical security controls while installing merchant payment systems. North Country Business Products has a lot of QIR’s. At least 139 impacted restaurants with credit card data breach dates here. NCBP POS systems are installed at over 6,500 locations.

Don’t be the next credit card data breach victim!

Christine Speedy is Qualified Integrator and Reseller certified by the Payment Card Industry Security Standards Council. QIRs are integrators and resellers specially trained by PCI Security Standards Council to address critical security controls while installing merchant payment systems. QIRs reduce merchant risk and mitigate the most common causes of payment data breaches by focusing on critical security controls. Call Christine for technology, merchant services and check processing needs.