Earlier this year, payroll department employees at four companies found themselves providing information from employees’ Forms W-2, Wage and Tax Statement, to individuals posing as company executives. The data included names, Social Security numbers and salary information.
The imposters’ weapons of choice: spoofing e-mails. The cybercriminals engaged in a phishing scheme that has resulted in warnings to employers from the Internal Revenue Service. Information gained from such a scheme can be used to file fraudulent tax returns.
This is the 21st century version of a note passed to a bank teller saying that a holdup was taking place, except no guns were used and personal information rather than money were given up electronically. For the companies affected, the scheme could inflict long-term financial costs.
New and old economy industries were affected by the scam. In each case, a payroll employee responded to a credible-looking e-mail attached to a company official’s name by sending W-2 information to the third party.
The data breaches led companies to implement additional security and training measures, or incur the expense of providing employees with identity theft or credit monitoring for several years. One company, which requested anonymity, told Bloomberg BNA that it did not have a dollar amount for providing identity-theft insurance and monitoring for two years. The company also said that it planned to strengthen the security and privacy awareness training it already conducts. Another company told Bloomberg BNA that it would not release the cost of providing credit-protection services.
Identity-theft insurance can cost $25 to $60 a year for each employee, and coverage may include credit alerts and monitoring, the National Association of Insurance Commissioners said.
What can employers do to combat this problem? In addition to more security measures, they can tell employees to follow a suggestion by IRS Commissioner John Koskinen and check before responding to an official-looking e-mail from the chief executive officer, for example, that asks for a list of company employees.
Employees whose employers experienced a data leak can go to the Federal Trade Commission website IdentityTheft.gov and report the security breach.
Take a free trial to Bloomberg BNA’s Payroll Library , your one-stop resource for reliable, up-to-date guidance and analysis in every area of payroll administration and compliance.
All Bloomberg BNA treatises are available on standing order, which ensures you will always receive the most current edition of the book or supplement of the title you have ordered from Bloomberg BNA’s book division. As soon as a new supplement or edition is published (usually annually) for a title you’ve previously purchased and requested to be placed on standing order, we’ll ship it to you to review for 30 days without any obligation. During this period, you can either (a) honor the invoice and receive a 5% discount (in addition to any other discounts you may qualify for) off the then-current price of the update, plus shipping and handling or (b) return the book(s), in which case, your invoice will be cancelled upon receipt of the book(s). Call us for a prepaid UPS label for your return. It’s as simple and easy as that. Most importantly, standing orders mean you will never have to worry about the timeliness of the information you’re relying on. And, you may discontinue standing orders at any time by contacting us at 1.800.960.1220 or by sending an email to firstname.lastname@example.org.
Put me on standing order at a 5% discount off list price of all future updates, in addition to any other discounts I may quality for. (Returnable within 30 days.)
Notify me when updates are available (No standing order will be created).
This Bloomberg BNA report is available on standing order, which ensures you will all receive the latest edition. This report is updated annually and we will send you the latest edition once it has been published. By signing up for standing order you will never have to worry about the timeliness of the information you need. And, you may discontinue standing orders at any time by contacting us at 1.800.372.1033, option 5, or by sending us an email to email@example.com.
Put me on standing order
Notify me when new releases are available (no standing order will be created)