A New Cyber-Security Breach

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In the financial world's latest cyber-identity crisis, Bank of America today is warning the holders of at least 1.2 million of its federal employee credit card accounts that a major security breach may have left their account information exposed to theft or hacking, according to a senior U.S. official and Bank spokeswoman.

The U.S. official said that federal law enforcement is investigating the loss of several Bank of America data backup tapes that were being transferred across country by air when they disappeared in December. "We are proactively sending letters to impacted cardholders," said Alexandra Trower, spokesperson for Charlotte-based Bank of America. She said that after intensive account-monitoring, the tapes are at this point believed to be lost, not stolen. "We, with federal law authorities, have done a very robust, thorough investigation on this and neither we nor they would make the statement lightly that we believe those tapes to be lost," she said. "We have no evidence that the tapes have been accessed in any way. We have witnessed no unusual activity. And we've been monitoring the situation very closely."

The U.S. official said a large percentage of the accounts are for the Pentagon but that some 40 federal agencies and other entities are affected. Some of the tapes related to non-federal card-holders, the official added. Trower would not comment on which agencies are affected, referring questions to the General Services Administration. A GSA spokesperson had no immediate response to an inquiry about the matter, including whether any of the Pentagon's billions of dollars in secret "black" programs could be affected. Pentagon spokesman Bryan Whitman said the data loss includes files on 900,000 of the Pentagon's three million or so military and civilian workers. "It is a significant number of the Department's employees," he said, declining to say whether it affected any who are working undercover.