By Grant Gross
August 14, 2006
The U.S. Department of Veterans Affairs will spend $3.7 million on
encryption software following a theft in May of hardware containing
the personal information of 26.5 million veterans and active-duty
The VA has awarded a contract for veteran-owned small business SMS
Inc. in Syracuse, N.Y., to install two encryption software packages on
all of the department's computers, handhelds and storage devices. The
installation is scheduled to start Friday, and VA Secretary R. James
Nicholson wants all VA laptops to include encryption software within a
month, the VA said.
Laptops will be the first devices to have encryption hardware
installed. The theft of a laptop and hard drive -- containing names,
dates of birth, Social Security numbers and some limited health
records -- from a VA analyst's home in early May set off widespread
criticism from the U.S. Congress on the VA's IT security program. Law
enforcement agents recovered the stolen hardware in late June, and the
FBI told the VA that forensic tests suggested thieves had not accessed
the personal data.
The encryption software installation will involve about 300,000
computers and other devices, said Warren Smith, vice president of
marketing at GuardianEdge Technologies Inc. in San Francisco. The VA
will use GuardianEdge's encryption software on its laptops, desktop
PCs and removable storage devices, Smith said.
Trust Digital in McLean, Va., will provide encryption software for VA
handhelds and smart phones.
The combination of GuardianEdge and Trust Digital will give the VA a
"comprehensive suite" of encryption products, Smith said. "We're very
confident we can provide the protection the VA needs."
Today's announcement comes after the VA last Wednesday said it will
use San Diego-based ID Analytics Inc.'s data breach analysis services
to ensure that the information contained on the stolen hardware was
not compromised. ID Analytics will check the VA's database against its
fraud detection network to monitor for misuse of the data, the company
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