Treasury cancels Booz Allen contracts after employee leaked

Booz Allen Hamilton’s stock price dropped by 8% on the heels of the Treasury Department’s announcement.

The department said it currently has 31 separate contracts with Booz Allen Hamilton, totaling $4.8 million in annual spending and $21 million in total obligations.

“President Trump has entrusted his cabinet to root out waste, fraud, and abuse, and canceling these contracts is an essential step to increasing Americans’ trust in government,” Bessent said in a statement.

“Booz Allen failed to implement adequate safeguards to protect sensitive data, including the confidential taxpayer information it had access to through its contracts with the Internal Revenue Service,” he said.

The department noted that between 2018 and 2020, Booz Allen employee Charles Edward Littlejohn “stole and leaked the confidential tax returns and return information of hundreds of thousands of taxpayers.”

The data breach affected about 406,000 taxpayers, according to the IRS.

Littlejohn, 40, pleaded guilty in October 2023 to one count of disclosure of tax return information.

He admitted leaking Trump’s tax records to The New York Times. He also admitted to leaking records about wealthy individuals to the news outlet ProPublica.

He was sentenced to the maximum term of five years in prison in January 2024.

CNBC has requested comment from Booz Allen.