Revenue data lost in mail

June 28, 2006

By Heron Marquez Estrada, Star Tribune

A package containing public and private tax data on about 2,400 individuals and 48,000 businesses is missing, the Minnesota Department of Revenue said today.

The department said the package, containing checks and a data tape, was lost in the mail and that it is working with the U.S. Postal Service to find it.

"This is a nightmare for me," Dan Salomone, state revenue commissioner, said this morning. "It's something every tax commissioner worries about."

Revenue Department officials said there is no indication that the package was acquired by an unauthorized party, but they have not yet ruled that out.

As required by state law, the department this morning mailed letters to the 2,400 individuals affected. The letters should arrive by the end of the week. The department said it is still working to notify the affected businesses and that should be done within a week or so.

Department officials also will be talking to those affected about how to obtain a free credit report and how to monitor their accounts for fraudulent activity.

The Revenue Department's regional office in Brainerd sent the package by certified mail from the post office in Baxter to St. Paul on May 16. The Postal Service was notified on June 13 that the package was missing.

The department is investigating why it took personnel a month to notice that the data was missing.

The Postal Service said it had no record of the package except for the certified mail receipt from the Revenue Department.

At a morning news conference, Revenue Department officials said they are conducting an internal investigation to find out why the package of sensitive material was sent by certified mail rather than by courier, which is the normal practice.

Steve Kraatz, acting chief information officer for the Department of Revenue, said that the data on the tape contains the names, addresses, employment data, Social Security numbers of the individuals and the names and tax data for the 48,000 businesses.

He and other Revenue Department officials said there is no indication that the checks in the package have been cashed or that the data has been accessed. Nearly all of the information in the package is related to tax audits and outstanding tax cases handled by the Brainerd office.

Kraatz said it would take highly sophisticated software and hardware to access the data which is encrypted. This is the third time in less than a year that the Revenue Department has lost sensitive tax information. Previously, an auditor lost a department laptop when it was stolen from his home, and a portable hard drive was stolen from the purse of a Revenue Department employment.

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