Lawmaker Says USIS May Have Shortchanged Cybersecurity before Hack of 27,000 Employee Records

Government background checker USIS blocked U.S. officials from fully probing the hack of more than 27,000 employee records on its network, according to the Office of Personnel Management.

The top Democrat on the House Oversight and Government Reform Committee also suggested the embattled company appeared to have shortchanged network security before the hack.

The new accusations come on top of a $1 billion Justice Department lawsuit alleging USIS defrauded the government by conducting incomplete background investigations.

Both OPM and USIS were attacked by hackers around the same time in March 2014, officials said Wednesday at a House Oversight and Government Reform Committee hearing. The security controls in place on OPM's networks shielded employee information. Hackers had more success with USIS' systems -- accessing sensitive data on tens of thousands of Department of Homeland Security employees.

The government took a more proactive approach than USIS to restrain the attackers, according to OPM.

"It comes down to culture and leadership,” OPM Chief Information Officer Donna Seymour said at the hearing. “One of the things that we were able to do immediately at OPM was to recognize the problem. We were able to react to it by partnering with DHS and their partnering agencies to be able to put mitigations in place to better protect the information.”

USIS officials were not immediately able to comment.

Reportedly, a nation state, perhaps China, was believed to have been seeking the personnel files of security clearance holders in OPM’s systems.

Rep. Elijah Cummings, D-Md., the committee's top Democrat, pressed Seymour on the cost of such protections, to gauge whether USIS might have been trying to cut expenses with inferior safeguards.

"Some of the appliances that you put on a network, firewalls and different software to separate data and to protect it so that it recognizes good traffic on the network from potentially erroneous traffic on the network -- those can be expensive” to install, operate and maintain, Seymour said.

Cummings has been investigating the claims that USIS submitted 665,000 deficient background checks to increase profits.

"USIS could have saved money by not investing in those cyber protections, is that right?" he asked.

Seymour responded, "Yes, you can save money by not implementing security, but it is a temporary savings because these vulnerabilities and the breaches that we suffer are expensive to remediate.”

What is clear is the contractor also ultimately lost money. USIS’ parent company, Altegrity, filed for bankruptcy in February, after OPM ended major contracts.

USIS had been the government's largest private supplier of employee background check services.

The contractor has since stonewalled efforts by Congress and the administration to closely examine its systems, Cummings and OPM officials said.

For seven months, USIS and its parent company have declined to answer questions from Cummings about why USIS' security measures were not strong enough to squelch last year's network breach, Cummings said.

OPM negotiated with USIS to let Homeland Security inspect part of the hacked network for vulnerabilities but was not granted full access, Seymour said.

"We were limited somewhat in our ability to scan the network because of the [distributed] architecture of the USIS network," she said, adding that the firm allowed DHS to scan two of the "subnets" of that network.

Ultimately, the government could not get a full picture of the problem.

"Let me give you an example: If you ask me to physically secure an apartment building but you only allow me to go into two apartments, I can't tell you what's in those other apartments but clearly they are part of the building that you've asked me to secure," Seymour said. "We were not able to go to the boundaries of the network."

In addition to the OPM and USIS hack attacks, a breach was disclosed last year at KeyPoint Government Solutions, another background check firm. More than 48,000 federal employees might have had their personal information exposed during that incident.