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SCDOR Running Deficit




S.C. Gov. Nikki Haley’s revenue department (SCDOR) is asking taxpayers to shell out $20 million to cover the agency’s failure to safeguard their personal information.  That’s almost a third of the agency’s annual budget.

Earlier this year, SCDOR coughed up 3.8 million Social Security numbers, 3.3 million bank account numbers, tax info for more than 650,000 businesses and nearly 400,000 credit and debit card numbers to as-yet-unidentified hackers.

While the long-term costs of the breach to South Carolina businesses are expected to run into the hundreds of millions – the immediate costs to taxpayers are nothing to shake a stick at either.

What costs have been incurred so far?  For starters, Haley has entered into a controversial $12 million deal to provide credit monitoring to those affected by the security lapse.  Then there’s the $3 million it will cost the state to notify citizens whose information was compromised.  The governor has also committed funds to various security analysts and attorneys – all without going through the state’s procurement process.

SCDOR failed to provide a detailed breakdown the expenses associated with this $20 million (imagine that) in submitting its loan request to the S.C. Budget and Control Board this week.  The agency received $67.5 million in the current year’s budget – an increase of $4.4 million from the previous year.

Haley initially claimed that “there wasn’t anything where anyone in state government could have done anything” to stop the breach – and that the Palmetto State used “industry standard” data security methods.  Both of those claims turned out to be completely false – as a simple $25,000 expense could have prevented the breach.

You’d think South Carolina could have afforded that $25,000 in light of the millions of dollars our state has appropriated to cyber security in recent years, although doing so might have precluded some powerful Bubba’s cousin from landing a cush six-figure job (a.k.a. what state government is all about).

Anyway, a special S.C. Senate subcommittee investigating the breach is scheduled to meet this week.  We look forward to seeing what this inquiry uncovers.