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Tax time brings cyber risks for businesses and taxpayers

IRS data breach highlights need for identity protection

Once again, cyber criminals have tried to use stolen Social Security numbers to claim tax refunds this year, highlighting the need for businesses to take extra steps to safeguard the personal information of employees and others.

Social Security numbers compromised

The IRS said it discovered and stopped an automated cyber attack on its e-filing system that generated personal identification filing numbers (E-file PINs) for 100,000 previously stolen Social Security numbers. The IRS placed identity theft markers on those accounts.

Identity thieves can collect tax refunds

Although the IRS said no new personal taxpayer data was compromised or exposed, the risk of tax fraud is clear. The latest incident follows a cyber attack last year that the IRS now says exposed Social Security numbers and other information of more than 700,000 taxpayers.

Improving protection is essential

"Identity thieves will do anything possible to access information they can exploit for financial gain," said Tim Zeilman, HSB vice president of strategic products. "It's important for businesses to take steps to protect their data and systems to minimize their potential for attack, and lessen the impact if they are successfully hacked."

IRS warns of income tax scams

Identity thieves can use Social Security numbers and other personal information obtained through these activities to apply for loans or collect tax refunds. The IRS routinely lists identity theft-driven tax fraud among its annual "Dirty Dozen" list of income tax scams.

ID Theft is a major concern

Identity theft also has topped the list of complaints to the Federal Trade Commission over the last decade, and that trend continued last year.

Keep security up-to-date

A simple, effective way to deter cyber theft is to make sure any and all personal or business computers are using appropriate, up-to-date software and Internet browsers. Secure software lessens the chance that identity thieves can access information.

Collect and store minimal information

Businesses should aim to collect and retain only the absolute minimum necessary information about their clients, and store it in as few places as possible. The less data that's available, the less that could potentially be stolen by identity thieves.

10 tips to help prevent a data breach

Click here for 10 tips to help a business prevent a data breach. In addition, business owners should purchase insurance coverage to help protect the private information of customers, employees, vendors and others.

HSB offers data and cyber insurance programs

HSB makes it convenient to add identity theft and data breach coverage for your small business customers. HSB Identity Recovery coverage and HSB Data Compromise coverage can be bundled with our HSB TechAdvantage™ equipment breakdown program.

Contact your HSB representative for more information.

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Tax time brings cyber risks for businesses and taxpayers