Governments cannot protect personal records, can the blockchain?

On June 4 of this year, a larger than usual privacy breach happened to the US government  Office of Personnel Management (OPM). This major hack resulted in the entire user database being stolen, including the records of more than 21 and a half million people’s most detailed government identification.

The OPM does not merely keep the personnel records of government employees. The agency does every background check that the government needs, mostly for sub-contractors of businesses that supply labor to government projects.

“We conduct background investigations for prospective employees and security clearances across government, with hundreds of thousands of cases each year.”

James Anderson, a former engineering contractor and bitcoin user from Atlanta, was among the 21.5 million. Although he wasn’t a government employee, six months after the event he received a letter from the OPM stating that they had been hacked, and his entire identity was compromised. Brave New Coin spoke with Anderson and confirmed that it was a worst-case scenario data breach.

His stolen information was gathered long ago, during a background check on in 2011. The job was a contractor position, for an engineering firm whose primary customer was the US Navy. “I had a background check in order to get a low level security clearance to handle confidential materials,” Anderson divulged.

The compromised data included all of the information one would submit to a detailed background check, from his social security number to information about family members and far more. With this information, a competent hacker could completely and fully appear to be Anderson online. Getting a bank account in Anderson’s name would be no problem, nor would submitting an application for legitimate state-issued identification.


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