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State Govt takes action against payroll provider over data breach

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The State Government has issued a “breach of contract” notice to its payroll provider over a data hack that saw the personal information of nearly 80,000 public sector employees exposed to cyber-attackers.

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The breach was revealed last month, with private and financial records of employees accessed and the Government investigating the matter with its longtime payroll provider Frontier Software.

“I am advised all public sector employees, except for Department of Education staff who are on a different payroll system, should assume that their personal information has been accessed during Frontier Software’s cyber-attack,” Treasurer Rob Lucas said at the time.

Treasury boss David Reynolds told parliament today the Government is now taking action against its payroll provider over the breach.

“We have issued a breach notice to Frontier for being in breach of contract to provide payroll services in a secure environment,” he said.

Reynolds said he was not aware of any individual whose details or finances had been compromised as a result of the breach.

He said it had emerged that Frontier had “information on one of their corporate servers, which was hacked by some overseas player as we understand it”.

“As it turned out they had transferred a file with our staff details onto their corporate network, out of our secure payroll system,” he said.

Reynolds said he understood the hack was by “some kind of eastern European group”.

The ransomware attack saw “significant personal information of SA Government employees” stolen, including their name, date of birth, tax file number, home address, bank account details, remuneration, payroll period, employment start date, superannuation contribution and amount of tax withheld.

Reynolds said whether the Government continued to use Frontier to provide the service “will be a matter to be considered once we’ve done the review”.

“We need to continue to have payroll services – we need a payroll provider,” he said.

“If we were to stop using them [we need to consider] how would we transition to a different provider, or ourselves?”

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