Stolen data on 3.3 million loans is found;

Star Tribune (Minneapolis, MN), METRO EDITION
BYLINE: PAUL WALSH; STAFF WRITER, STAR TRIBUNE (Mpls.-St. Paul)

Minneapolis, MN

Despite publicity about the theft, the stolen data sat in a Minneapolis police evidence room for three weeks.

Stolen personal information on 3.3 million student loan borrowers was recovered from a Minneapolis trash bin and sat in a police evidence room for weeks before authorities knew what they had, state officials said Friday.

Two 200-pound safes containing the information were stolen sometime over the March 20-21 weekend from the Oakdale headquarters of Education Credit Management Corp. (ECMC), a nonprofit that services and insures student loans, according to the state Bureau of Criminal Apprehension (BCA).

The personal information, on 650 CDs and floppy discs, does not appear to have been compromised, the BCA added. The data include customers' names, addresses, birth dates and Social Security numbers. No bank account or other financial information was included.

The safes, pried open, were found March 22 in an alley in the 3500 block of Knox Avenue N. by a landlord in the neighborhood. The CDs and floppy discs, still in their original packaging, were found in the trash nearby. Police took the safes, CDs and discs to the department's evidence room for later inspection, said Andy Skoogman, spokesman for the state Department of Public Safety.

Police gave the recovered property "normal" priority, and it was "put in line to be analyzed ... and treated like the hundreds of other pieces of property that they recover," Skoogman said.

The Star Tribune reported the burglary March 27 in a front-page story in which U.S. Department of Education officials called it one of the biggest cases of student identity theft in the nation, affecting 5 percent of all students with federal loans in the United States.

Despite that publicity, Minneapolis police didn't realize until April 12 that they had recovered the data, officials said.

"It's not uncommon for us to recover safes. We recover so much property," said Minneapolis police Sgt. Jesse Garcia. Police at first tried to read the discs but failed to crack them, Garcia said. "The main thing is it [the data] sat in our property room, secure," he said.

Investigators have identified a suspect in the theft, Skoogman said. He has not been charged but is in custody on a parole violation, he said. The suspect is not a current or former employee of ECMC. Investigators say there may be additional suspects.

Theft, but not ID theft

Skoogman said he doubts that the motive for stealing the safes was identity theft.

ECMC President and CEO Richard Boyle said, "We were very pleased to learn ... that the property and data stolen from ECMC headquarters has been recovered and that law-enforcement officials believe that the personally identifiable information ... does not appear to have been compromised."

The BCA lab in St. Paul is looking at the safes and their contents for additional evidence. When that analysis is complete, the U.S. Department of Education office of inspector general will review the digital media as a precaution to definitively determine whether data was compromised.

ECMC is one of the top 10 student loan guaranty agencies in the country, according to its website. Long based in St. Paul, it moved its headquarters -- and 320 jobs -- to Imation's campus in Oakdale in 2008.

ECMC expects to lose much of its business as a guarantor of student loans under a law signed by President Obama soon after the theft was reported. The law ends government guarantees and subsidies of private bank loans for college tuition. Instead, the government will expand its program of direct lending to students.

ECMC, founded 16 years ago, insures about $11 billion in student loans. Much of that activity will be taken over by the government, which will back its own student loans. While ECMC can't issue new loan guarantees under the government program, it will continue to insure current borrowers, who have an average repayment schedule of 10 years.

The Associated Press contributed to this report. Paul Walsh - 612-673-4482

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