Wednesday, 23 March 2011 Breach – Don’t Trust your Third Parties

Over the last couple of days many customers have received an Email, informing them their personal information has been breached, including me. This Email states “We are emailing all our customers to let you know that a company that handles part of our marketing communications has had a security breach. Unfortunately this has meant that some customer names and email addresses may have been compromised.” So personal details were stolen thanks to a security breach at’s third party service provider, namely a US based marketing company called SilverPop. sent the warning Email in response to an increase in malicious Emails being targeted at customers, this was first noticed on 20th March 2011.  It is worth noting SilverPop, actually a US based Email marketing company, was breached in December last year; this was the point which the customer information was actually stolen, although nor SilverPop failed to realised the data was breached at the time.

The Risk to Customers
The facts of this breach is only customer names and Email addresses were stolen, so the more important information such as credit/debit card information and usernames and passwords have not been compromised, as thankfully didn’t share such information with SilverPop.  It seems pretty clear to me that the bad guys who stole this information sold it on for exploitation by Spammers and Phishers. Therefore the advice to customers is to be extra vigilant for phishing Emails. There have been several reports of Spam Email originating from addresses (obviously with different fake domain names).  Always remember will never ask you for your username and password by Email or by phone, and I would also advise never to click any links within Emails which seemingly originate from, only login directly on the website by typing in the URL. If you do receive any dodgy Emails forward them on to

The “Third Party lesson” to Business
I don’t want to give a hard time as when it comes to information security they aren’t too shabby, especially compared to other merchants which operate in the same marketplace. But in their statement it states “Please be assured this issue has occurred outside of”, well I am not assured at all. The “Data Controller”, which is, is the company that collected the information in the first place, and so is at fault. has a legal obligation to protect the personal information they have collected from us, which includes the sharing of such information with third parties.  In this case I guess didn’t place a high enough value on the information it was sharing with its third parties,  even though a list of Names with Email addresses all associated with a single merchant website carries a decent value on the black market. Again I’m speculating, but if this type of information didn’t have a high value placed on it by the business, unlike the credit card data in their care, then it is easy to expect the controls and management around sharing it with third parties to be lax.

Sharing personal or other sensitive information with third parties carries a risk to which the business is responsible, and as such needs to be adequately controlled. Before sharing such information with any third parties, the business is suppose to fully assess their third parties service providers, to ensure they are capable of protecting the information to the same level as their own business as well as to legal requirements. Interestingly the SilverPop third party is based in the United States, where the same levels of personal data protection don’t match up to stricter European standards.  Information Security due diligence needs to be performed prior to accepting a third party services to which information is intended to be shared. This assessment needs to be more than just sending the third party a security questionnaire to complete, but an actual on site assessment by a person with an appropriate level of expertise, even an independent appointed third party assessor if need be. People tend to provide the answers you want to hear in questionnaires, making the effort and going to the site and asking your information security questions face-to-face provides a much greater understanding of your third parties approach to protecting the information you intend to share with them.

Third Party Assessing & Contracts
To ensure third parties continue to obverse the level of information security desired, the business must hold them to account in a business contract, with stiff penalties for breaching the contract. This should include the right to onsite audit the third party; these measures provide incentive to the third party to keep information security ship-shape. Don’t forget to pass on any breach costs within the contract as well, as personal data breach legal fines in the UK can reach up to £500K, while industry regulatory fines can even be higher, without contractual coverage you can’t pass on those fines to a third party.  While talking about contracts, it is good to add a clause which compels the third party to report any security incidents involving the business data, furthermore add the right to conduct an onsite forensics investigation at the third party site should a data breach occur. If you can’t get a third party to sign up to such clauses in a contract, it is a clear indication the third party’s information security isn’t up to scratch, as the third party business mustn’t have any confidence in their own information security.

Original Customer Breach Notification Email

Dear Customer,

Email Security Message

We are emailing all our customers to let you know that a company that handles part of our marketing communications has had a security breach. Unfortunately this has meant that some customer names and email addresses may have been compromised.

We take privacy and security very seriously and ensure all sensitive customer data is protected.  Please be assured this issue has occurred outside of and no other personal customer information has been involved.

Please be assured we have taken every step to ensure this doesn’t happen again and accept our apologies for any inconvenience this may have caused some of you.

Customer Advice

Please do be vigilant with your email and personal information when using the internet. At we will never ask you for information such as passwords, bank account details or credit card numbers. If you receive anything suspicious in your email, please do not click on any links and forward the email on to for us to investigate.

Thank you for continuing to shop at and we look forward to serving you in the future. Customer Service Team

Follow Up Customer Breach Notification Email

Dear Customer,

As a follow up to the email we sent you last night, I would like to give you some further details. On Sunday the 20th of March some customers reported receiving a spam email to email addresses they only use for We reacted immediately by informing all our customers of this potential security breach in order for them to take the necessary precautionary steps.

We believe this issue may be related to some irregular activity that was identified in December 2010 at our email service provider, Silverpop. Investigations at the time showed no evidence that any of our customer email addresses had been downloaded. We would like to assure all our customers that the only information communicated to our email service provider was email addresses. have taken all the necessary steps with Silverpop to ensure a security breach of this nature does not happen again.

We would also like to reassure our customers that all other personal information (i.e. credit cards, addresses, passwords, etc.) are kept in the very secure environment. has one of the most stringent internal standards of e-commerce security in the industry. This is audited and tested several times a year by leading internet security companies to ensure this high level of security is maintained. On behalf of, I would like to once again apologise to our customers for any inconvenience due to a potential increase in spam that may be caused by this issue .


Nuuki said...

In the last week customers have been hit with a spear phishing effort. A member of my own team spotted it (she does work in security so I'd have been saddened otherwise) and called them up, and they say they've had a *ton* of calls about this since the weekend.

The mails do include the customer name so whilst not massively sophisticated, its certainly using more than just email addresses. Maybe its taken nearly 6 months for this data loss you blogged about to get sold on and used...

SecurityExpert said...

Thanks for this Info.

Interesting, but I fear it was only a matter of time, as the bad guys who go after this type of personal data, don't do it for the hell of it or to prove a point, but do it for their profit.

I'll look into this further and see what else I can find out

Arup Datta said...

Thanks for the post.
I think it is very useful for the IT lovers people.