How the IRS Is Leaving Your Financial Data Unprotected

The tax agency needs to better audit its own accounts, according to the Government Accountability Office. GAO officials during the past year discovered that Internal Revenue Service was not sufficiently monitoring databases for abnormal activity that could indicate a breach. They also found poor encryption on key agency systems.

In addition, this is the seventh consecutive year the IRS has failed to patch security vulnerabilities that could compromise financial data, a review of GAO reports dating back to 2007 reveals. 

"Serious weaknesses remain that could affect the confidentiality, integrity, and availability of financial and sensitive taxpayer data," Nancy R. Kingsbury, GAO managing director for applied research and methods, and Gregory C. Wilshusen, GAO director for information security issues, wrote in a new report. 

The IRS did not apply critical patches in a timely fashion to multiple systems, including programs for procurement and email, the auditors said. In addition, the agency was running unsupported software on workstations and databases that developers are not even issuing security fixes for anymore. 

GAO officials also noticed that systems handling transfers of financial data were not configured to encrypt login information.

This week’s report acknowledges longstanding problems the IRS has had with monitoring system activity and with physically securing data.

"Despite ongoing efforts dating back to 2007, IRS’s enterprisewide mainframe security monitoring program" has not provided log reports to system operators, the auditors wrote.

At two of the three computing centers GAO evaluated, officials did not consistently feel the need to block access to restricted areas for individuals who no longer needed entry. Auditors had made a recommendation in fiscal 2011 to fix this issue.

Last year, GAO documented similar weaknesses.

Auditors noted some improvements, including the resolution of certain system control deficiencies, as well as upgraded software for the agency's administrative accounting system. 

In written responses to GAO, IRS officials said they are dedicated to improving the agency's data protections. 

"The security and privacy of all taxpayer information is of the utmost importance to us," IRS chief John Koskinen wrote on April 1. "We appreciate your continued support and guidance," and look forward "to working with you to develop appropriate measures." 

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