US Customs and Border Protection has suspended all federal contracts with a surveillance contractor suspected of suffering a data breach, according to a report from The Washington Post. Perceptics, which sells license-plate scanners and other border control equipment, is now prohibited from contracting with CBP and all other federal agencies. CBP officials listed the cause of the suspension as “evidence of conduct indicating a lack of business honesty or integrity.”
The suspension appears to be connected to a breach first reported in May, which publicly leaked license plates, traveler pictures and other personal data collected at the border. According to CBP, the breach was the result of a federal contractor copying agency data onto its corporate network, which was subsequently compromised. According to CBP, the data was collected from a single land-entry port over roughly a month and a half, and affected fewer than 100,000 travelers.
Perceptics was never officially named in connection with the breach, but as a prominent vendor of license-plate recognition systems at the border, the company was naturally subject to suspicion. That suspicion was heightened when the agency released a public statement on the issue with the file name, “CBP Perceptics Public Statement.”
While nominally temporary, such a suspension can have severe consequences for surveillance companies, which typically rely on federal contracts for the bulk of their business. “Perceptics and its management categorically denies any illegal or unethical behavior,” the company told the Post in a statement, “and we stand ready to meet to discuss this with the government in any setting.”