Simple Typo Causes Million Dollar Budget Problems
from the safeguards? dept
We’re always amazed when a lack of any kind of safeguard allows simple mistakes to cause such big problems. There was the trading typo in Taiwan that caused someone to accidentally buy $251 million in shares and the swapped monetary amount and share numbers that caused a Japanese firm to lose nearly a quarter of a billion dollars. In both cases, you have to wonder how come no one thought to put in any electronic safeguards that would notice something was amiss. It’s not just in stock trading where this kind of thing happens, either. The latest story is that a town in Indiana is facing all sorts of budgetary problems due to someone (probably not employed by the city) who incorrectly entered a computer system and valued a $122k house at $400 million. The city used the valuations to estimate tax revenue for the year, and the difference boosted this homeowner’s expected taxes from $1,500 to $8 million. Without any safeguards or any humans checking into what was going on, much of that $8 million got allocated to local schools and various city projects. They then spent the expected money, only to discover last week that it doesn’t exist. Again, shouldn’t any computer system like this send up an alarm when a $100k house is suddenly valued at $400 million? Heck, shouldn’t it send up an alarm when any house is valued at $400 million, no matter what it’s previous value was? Admittedly, it was caught in some parts of the system — but the fact that it was allowed to go through to other parts of the system would appear to be a pretty big problem. Another oddity in the story is the claim that the program where the typo was entered was “no longer in use.” If that’s the case, then (1) how did someone get to it and (2) why should it matter if they made a change?
Comments on “Simple Typo Causes Million Dollar Budget Problems”
Justs proves the point of politicians greed. Thier blindness is the ultimate failure. How could multiple people not notice that that amount of money extra was now available that year? How can you not notice 400 million in new homes was not built???
If your bank makes an error and deposits extra money into your account, most sane people will realize the error and NOT spend it since they know the bank will want thier funds back.
Hopefully those in that area will vote, and vote thier pockets if not thier hearts. All most everyone does now is vote with thier race, politcal party, or what thier “friends” do.
Human error will always find a way to beat technology. In no way can human error be used as an excuse when the mistake is caught along the way. Whenever a mistake is caught and it’s allowed to continue until some sort of disaster hits, the ones to blame are management. In the case of the house being listed as $400 million, the layoffs should be on the management side of the house.
Re: Human Error
I don’t buy that argument. If MasterCard has the technology to track and red flag unusual purchases to my credit card and then to confirm if I made those purchases (no I did not buy $600 worth of clothes from LL Bean), then surely similar safeguards should exist for other financial systems.
Re: Re: Human Error
Quote by by Mousky
“surely similar safeguards should exist for other financial systems”
You over-estimate the power of a good mainframe database. 🙂 I’m sure that county’s database is so messed up that they can’t make heads or tails from it.
No Subject Given
Although I agree that something like this should raise a flag, it seems like the greater error is not enough debugging when launching remote access systems. This other program, supposedly no longer in use, was still acessible. This is not only an enormous bug, but a serious security whole obviously. Either way, unless they do implement safeguards as mentioned, they had this coming. Maybe this will be a warning for other areas.
Frankly it is both greed and incompetance…… since our servants have now become our masters, we must act and fire the lot and employ those who have our interests at heart and wish to properly undertake civic duties for the good of the community….i live in the uk and we have the same problems…..trouble is….the electorate, on both sides of the ‘pond’ is a pretty pusillanimous bunch, so we are pretty much stuck…..
deus ex machina
A computer program isn’t some kind of deus ex machina. While error checking is needed, does this represent a fault? How is the program supposed to know what home valuations were without some bigger infrastructure? There could have been no digital data from the previous year, and valuations were typed in by a part time data entry person. It’s difficult to say if this is a serious fault or not without knowing more about how their system was set up. As for the Japanese company that experienced the bad entry, the same thing goes. As a programmer on that one you are forced to deal with huge sums of money, where do you put the limit? Do you send notification to supervision of all transactions? How does that affect your company’s agility? All too frequently I find that people/companies expect computers to be the end of their problems. At some point the person sitting there typing (like I’m doing now) is responsible to take literally seconds to double check their work. The same argument applies to assembly lines, automobiles, etc. If i get up in the morning and neglect to tie my shoes, is it the fault of the shoe manufacturer if I trip? Now that’s a stretch from missing a decimal in a text box, but you can see my point. Is anyone in agreement with me on this?
Re: deus ex machina
Partly agree. Fault tolerance in a program is the responsibility, not of the designer, but of the person deciding on how to use the technology. That said, so much software is so complex that it can be difficult for the person using it to know how their inputs will be used. Did the person deploying this program have the option to “flag” potentially over-valued (or under-valued) homes? What criteria were available? How clear was the documentation (on-line or hardcopy) in directing that effort? It really is a joint effort between the software developer and their understanding of the issue vs the user and their understanding of the software.
What ever happened to common sense? I would think that common sense would dictate that if there was a sudden $8 million budget increase over the previous then you might want to investigate a little before allocating and spending the money. I agree that to error is human, but at what point you draw the line between someone making a mistake and someone being careless and not checking their work. I was always taught to double and triple check data before I submit it. Expecially production level data, or data that is really hard to have corrected. It only took me getting my butt chewed once for screwing up a T&E workbook to realize that one.
No Subject Given
You have to remember, these are the same clowns that, in my area, when a majority of the voters passed a tax increase to build a bigger jail, diverted the money to operate it once built to their pet programs for the disadvantaged, then blamed everyone else for not being able to open the jail once it was built. And hardly anyone here called them on it! We deserve the government we put up with.
Most people would go to jail for things like this.
This all just seems to surreal… and all I have to say is negligence!
Where’s the heading hat’s fair and partial that says “Cheney shoots hunting companion?”
Legislators are immune from the law it seems.
Re: Most people would go to jail for things like t
Not at all. In the Seattle School District some years ago (around 2002 as I recall), there were 2 year’s budgets passed off as balanced that were, in fact, 30 million dollars off. That’s right, there was a shortfall of 30 million dollars or so all of a sudden.
This is far from the first time something like this has happened in governmental affairs and is far from the last, I’m sure. Noone ever goes to jail on these sorts of things unless they actually pocketed money somehow. You’d be surprised how hard it is to actually do anythign about this sort of apparent negligence.
No Subject Given
This is the same mentality that results from the ignorant using calculators in chemistry or physics classes. Students will figure the size of an atom to larger than the size of the known universe and not see the result as rediculous. After all, the calculator gave the answer, so it must be right. In this case, some computer gave an answer about the total tax revenue, so it must be right.
Unfortunately, probably was a city employee
Also, it probably took months and lots of headaches with the city to correct the problem because nobody there had enough common sense (or brains) to realize the problem was rediculous.
Well there is nothing common about commonsense
How’s a computer to know what is normal or abnormal? Sure a programmer could put in checks for some subset of possible errors, and catch those. But tons of other errors, ones the programmers couldn’t have predicted, will still slip through.
The only way to have an automated system to check for these sorts of things is to have some sort of context that systems are aware of. And I don’t just mean a database with some “If this and this then ERROR” lines. I mean an AI with “understanding” of the human context. I mean that sci-fi stuff, where your machine tells you “There are several opportunities that might interest you this morning sir…”
What's the incentive to evaluate value increases?
The reason the software didn’t catch it was because the software purposely was designed to ignore huge increases in value. Cities routinely randomly “reappraise” homes to increase tax income, and unless it’s blatant few people notice or care. A system that does data analysis and tells the city that a value increase is unreasonable would create a paper tail that proved that they were constantly entering ridiculous property value assessments. Better to accept the occasional massive fuckup, blame the software and give a mea culpa than to actually put a lid on the cookie jar.