In its most recent annual report the S.C. Department of Revenue (SCDOR) – which recently coughed up virtually all of its “Secure”data to international hackers – described its efforts to outsource a significant chunk of its data management.

“Through an outsourcing project with SourceCorp, a contract vendor … W-2 employer information were scanned and loaded into the vendor’s online system FasTrieve and data files (were) produced to upload into the DOR’s Data Warehouse,” the report noted. “By having the employer W-2 information in our systems and the image available for viewing, DOR employees have an improved and expanded source of data available to audit returns.”

In other words when a taxpayer files a return, it is scanned and then the data from the scanned image is keyed into the agency’s databases.

Sounds nifty, huh?  Assuming you’re an auditor, anyway …

The only problem with this arrangement?  According to our sources at the agency, SCDOR never told anyone that SourceCorp would be using overseas labor to perform data entry tasks on data from Palmetto State taxpayers and businesses.

“While SourceCorp says that all of the data stays in the United States, there are people in foreign countries sitting in front of computer screens, looking at our information and then keying it back into a system,” one source tells us.  “This information is then sent back to (SCDOR).”

Does this process sound remotely secure to you?

Obviously we’re not alleging that this company – or this particular data outsourcing method – had anything to do with the massive security breach at SCDOR, but it certainly doesn’t strike us as the sort of arrangement that’s going to instill much confidence in the people of South Carolina.