Bakersfield (Thursday, Dec. 2, 2021)—The typically tepid and mild-mannered Kern County Grand Jury issued a scorching report today about bungled use by the City of Bakersfield of its own financial reporting software. Errors and ignorance about the capabilities of software tools used by Bakersfield’s technical services personnel, plus failure to have adequate written policies regarding data breaches—or notification standards to protect those potentially harmed—comprise a worst-case scenario that computer privacy and security experts have been warning corporations, municipalities and individuals about for decades.

The grand jury investigation revealed that private information of both current employees and those receiving city pensions were compromised. The report indicates that the city does not even issue pensions itself, but nonetheless issued 1099 reports to the the federal internal revenue service (IRS)—without city personnel being aware that had happened. The 1099s erroneously stated retirees were receiving sums from the city. Those on pensions were reported to have been paid significantly more than they actually received, resulting in letters from the IRS demanding additional tax payments from retirees, along with penalties. Retired personnel were not notified for four months that the breach had occurred—leaving them to puzzle themselves about why they might have received a penalty notice from the IRS.

Ignorance on the part of technical services workers employed by the city appears to have laid the groundwork for what could have been transformed into massive fraud. The grand jury report indicates such fraud did not take place, but the investigation reveals serious flaws in the city’s management, with inadequate staff and inadequate expertise.—
By Patric Hedlund, TME

See the full details in next week’s issue of The Mountain Enterprise.

This is part of the December 3, 2021 online edition of The Mountain Enterprise.

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