IRS suspends its contract with Equifax amid new security concerns

IRS suspends its contract with Equifax amid new security concerns

The U.S. Internal Revenue Service has temporarily suspended a contract worth more than $7 million it recently awarded to Equifax Inc following a security issue with the beleaguered credit reporting agency's website on Thursday.

"The IRS notified us that they have issued a stop-work order under our Transaction Support for Identity Management contract", an Equifax spokesperson said on Friday.

"During this suspension, the IRS will continue its review of Equifax systems and security", the agency said in a statement, adding that "there is still no indication of any compromise of the limited IRS data shared under the contract".

"So when we came down to September 29 when the Equifax contract expired, we had to either stop the service, which means millions of taxpayers would not be able to get their transcripts, including those that are in need of it, like in the hurricane disaster areas they use those tools to get their transcripts, or do a bridge contract with Equifax until GAO decides on the protest and we move forward", he said.

"We remain confident that we are the best party to perform the services required in this contract", the spokesperson said.

According to Politico, Equifax was contracted "to verify the identities of taxpayers when they create accounts on its website", however their current suspension "means that taxpayers will not be able to establish new accounts through a program called Secure Access, which grants them access to online records and transcripts". We are engaging IRS officials to review the facts and clarify available options. If you have already enrolled, you're fine and can continue to access your account online.

The IRS has put that contract it holds with Equifax on standby.

IRS officials argued prior their hand was forced on the awarding of the sole-source contract because Equifax, the incumbent contractor on a previous deal, had protested the July decision to give it to another vendor.

An "alert" on the IRS website says the Secure Access service "is unavailable for new users at this time".

"Our focus now remains on protecting consumers and getting answers for the 145 million Americans impacted by this massive breach", they said. "We can not know taxpayers are protected until Equifax is banned from all federal contracts".

The Government Accountability Office later disputed the assertion that IRS had no choice, saying contracting law allowed for the agency to start working with Experian by citing urgent and compelling circumstances that would significantly affect the interests of the USA government.

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