WASHINGTON, Feb. 27, 2014 – A new report from USDA’s Office of the Inspector General (OIG) finds the department’s National Agricultural Statistics Service (NASS) isn’t doing a good enough job securing its data – a problem that could lead to high volatility in the agricultural commodity markets.

OIG found that “lockup” procedures – during which reporters are allowed to view NASS’s monthly or annual market data prior to its release in order to write their own reports – are faulty. Specifically, OIG found three instances in which press articles were accidentally released before NASS’ own data. OIG investigators were also able to bring a cell phone into a lockup and observed a reporter using a wireless iPad – clear violations of USDA policies.

In those circumstances, market traders watching for the release of data on NASS’ website, rather than news reports, had delayed access to the numbers. A recent report from the the Federal Reserve Bank of Kansas City demonstrated “higher volatility may have persisted…if some groups of traders, wishing to place a trade only after accessing [crop reports], are unable to access the information at the same time as others with faster access.”

“The reports that NASS produces are extremely market sensitive and contain major principal economic indicators of the United States economy,” OIG wrote.

The Inspector General also found major gaps in NASS’ IT systems. An audit found over 4,800 vulnerabilities on 899 devices across NASS’ network, “which NASS was not talking action on,” OIG wrote.

NASS says it has taken action to resolve 3,900 of those vulnerabilities, and will be reviewing its security systems with both internal and external groups.

NASS also says it will be working to improve lockup procedures. The agency has purchased “an electronic screening device that all lockup entrants must pass through to prevent wireless and cellular devices within lockup,” it reports. It will also revise a number of its lockup procedures by October 2014.  


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