This is about computers. I know, you couldn't care less, but this time you need to listen up! By now just about every major periodical and newspaper has run a few articles about the "Y2K" or "Year 2000" problem. We will only briefly touch on the technical aspects of this problem so that you understand WHY you need to be concerned. The primary purpose of this report is to give you specific suggestions about protecting yourself and your assets. Ignoring the Y2K problem could cause you the loss of some or all of your assets, inconvenience and major frustration. Please read on.
Let's put this Y2K problem into perspective. Every so often there will be a news item about a computer failure or malfunction that causes some havoc. Generally the problem is quickly corrected. The fix is usually fast and easy since, more often than not, the problem is traced to human error and not the system itself. Now think about the effects if these malfunctions started to happen to thousands of computers at the same time ... and the problem could not be easily fixed.
If you don't think this is something to be concerned about, think about these "Y2K related" real-life stories.
* A man entered a small hospital in Oklahoma for emergency treatment. The bill is over $600. Since he did not have that much cash he presents his credit card for payment and the charge is rejected. The expiration date on his card is 9/1/00 and the credit card company doesn't even know he exists anymore. Everyone is upset. (Lucky he didn't have to pay in advance!)
* I recently called my bank and asked if I should be concerned about the Y2K problem. I was told they are "working on the problem" and they "hope" to be ready by 12/31/99. I asked if my money was safe and was told to call back in a few months to check how they were doing! They admitted that during their work on this problem they found that their vault would not have opened after 12/31/99.
* A three-year defense contract awarded in April 1997 for completion in January 2000 caused a computer to issue a 97-year delinquency notice to the contractor.
* A traveler was checking in through a rental car kiosk (kind of like an ATM machine). The system indicated that "it looks like your driver license has expired". The Virginia license had an expiration date in 2001 and could not be recognized by the machine. A lot of time was wasted as the traveler had to find a "real person" to be able to rent a car.
Computers are used EVERYwhere and in places you don't necessarily see them. Cars, appliances, elevators, security systems, tools. These are the so-called "embedded" computers. Banks, corporations, and nearly every business in the world use other (more visible) computers for bookkeeping and data retention. Unless you take some simple steps to protect yourself, here are some examples of what you might expect:
* Your personal and business checks are returned for payment
* Your Social Security or retirement check does not arrive
* You arrive at the airport only to learn you don't have previously made have reservations
* You receive a $15,000 telephone bill
* You attempt to get cash from an ATM and the machine "eats" your card
* Overdue payment notices begin to arrive
* You're stopped for a traffic infraction and are told your drivers license has expired
* Your credit card statements show incorrect amounts
* You visit your bank to remove some papers from your safety deposit box and are told the vault cannot be opened
* You're at a New Year's party and the elevator you're on suddenly stops between floors
Stated simply, the Y2K problem is that most computers will malfunction when dealing with dates after December 31, 1999. The reason for this is that the computer software only stores the last two digits of the year. So 1997 becomes 97; 2000 becomes 00; and so on. When computers "lose" the date many strange things can happen which can lead to the corruption or loss of data or in the case of embedded computers, loss of functionality. Here are a couple of examples of what can happen when the computer doesn't understand what the "real" year is:
* Junior was born in 1995. When the computer program calculates his age, it subtracts his birth year, represented as "95" from the current year, represented as "97". Therefore, Junior is 2 years old. No problem there. Now, let's look ahead to the year 2000 and the same computation takes place. However, now "95" is subtracted from "00" and this is where the fun begins. He probably won't be negative 95 years old because the minus sign will be ignored. According to the computer, then, Junior is 95 years old and starts receiving Medicaid and Social Security benefits.
* Grandma was born in 1905 and her birth year, "05", is subtracted from the current year "97." Grandma is 92 years old. When the year 2000 rolls around, the computer says that Grandma is 5 years old and is told to report to kindergarten.
This would be hilarious if it weren't so serious. The Y2K problem will unpredictably affect computers used in business, government, military, communications, law enforcement, health care, utilities, transportation, banking and finance, farming and the food supply.....virtually any institution you can think of.
If you believe everyone is working to resolve the problem, forget it. Most enterprises are just becoming fully aware of the situation and even with the best intentions, there is not enough time or people to fix all the affected software. We are talking about analyzing and correcting hundreds of millions of lines of computer program code world wide and an estimated $600 billion price tag to correct the programs in the U.S. alone. It is estimated that only 25% of all the computer systems will be fixed by the start of year 2000.
Here are a few examples of what could happen starting January 1, 2000, as various computers are affected by this problem.
* Disruption of 911 emergency services
* Problems with air traffic control
* Trains improperly routed on track sections
* Failure of electrical generating systems
* Loss of or corruption of patient records in hospitals
* Improper traffic signal operations
* Disruption of deliveries
* Loss of banking records
* Loss of insurance data
* Failure of telephone systems
* Improper billing and invoicing
* Failure of building environmental and security systems
* Improper operation of FAX and telephone answering machines
* Loss of investment records
* Failure of various agencies to properly generate payment checks
* Personal computer malfunctions
* Building elevator malfunctions (stop between floors, doors may not open)
* ATM machine malfunctions
* Loss of hotel and travel reservations
..... and this is by no means a complete listing!
Many of these examples will affect most of us in one way or another and there is plenty you can do to protect yourself from the results of these failures.
THINGS TO DO DURING THE NEXT FEW MONTHS:
1. Write letters to financial institutions with whom you have dealing (banks, mortgage company, etc) and ask if they are Year 2000 compliant. Send the letter registered and ask for a signed return receipt. A sample letter is included at the end of this report. Ask for up-to-date copies of your records. There are going to be plenty of lawsuits relating to the Y2K problem. These letters may come in handy.
2. Get copies of your credit report.
3. Make certain your financial records are complete and up-to-date. If you are not already doing so, keep records of EVERY one of your financial transactions.
4. Ensure you have copies of the last five years of your state and Federal tax returns.
5. If you own stocks or other instruments, and the company holding them does not convince you that they are Y2K compliant, consider selling your holdings and do not reinvest until after Jan 1, 2000. Check with your tax advisor for the best way to do this so that you do not incur unnecessary tax liabilities.
6. Check your own personal computer for Y2K compliance. This involves checking both the hardware and software packages you use. Checking the hardware involves the use a small software package that will test to determine if your hardware will function properly after 12/31/99. There are many such packages available on the Internet free for downloading. As one example, check, http://www.nstl.com/html/ymark_2000.html
7. Contact each manufacturer of your software packages and ask if they are Y2K compliant. Again, the Internet is an efficient way to do this since nearly all software manufacturers have websites. For example, Microsoft, at: http://www.microsoft.com.
8. Carefully check every invoice and bill you receive. Errors are likely to occur.
9. If you are doing any traveling, check and recheck your reservation status with hotels, motels, airlines, trains, rental cars, etc.
THINGS YOU SHOULD CONSIDER NOT DOING BETWEEN DECEMBER 30, 1999 AND JANUARY 5, 2000
1. Fly on an airplane
(air traffic control may be disrupted or fail; on-board computer systems may fail)
2. Use an elevator
(Elevators may stop suddenly between floors; doors may fail to open)
3. Schedule any medical tests or surgery in a hospital
(hospital records may become corrupted; emergency systems may fail)
4. Make a long distance call at midnight, Dec 31, 1999.
(you might get charged for a 99 year long phone call)
5. Ride a train or any underground people movers (subways, etc)
(traffic systems may fail, automatic systems may malfunction)
6. Don't use an ATM machine
(your bank account records may reflect an incorrect withdrawal amount)
7. Don't make a bank deposit
(your account may not reflect the deposit)
8. Don't pay any bills (pay any bills due the first few days of January, 2000 the middle of December, 1999. Send payments via registered mail (this one time) and keep good records of the payment!
(You may find that your account is not properly credited)
THINGS TO DO IF YOU OPERATE A SMALL BUSINESS:
1. Contact your suppliers to ensure they will be able to ship your orders even in the event their computers fail.
2. Call your payroll processing service to ensure they are Y2K compliant.
3. Ask your security system supplier if your installation is Y2K compliant.
4. Determine if your cash register (and other point of sale equipment) will operate properly after 12/31/99.
5. Check to ensure that your business liability insurance policy will cover any losses due to Y2K-related problems.
6. Ensure that your computer hardware and all software are Y2Kcompliant.
7. Check with your merchant card account provider to ensure Y2K compliance.
Don't be a victim - heed these few simple suggestions.
Here is a suggested letter format to send to your bank and other financial institutions with whom you have dealings (investment companies, mortgage company, etc). The letter should be sent to the President or CEO with return receipt requested. Call to determine name and correct address.
As a customer of [name of organization], I am very concerned about the upcoming Year 2000 (century rollover) computer problem and possible effects on client records and accounts. I would like to know what steps your company is undertaking to assure me that your computer software and hardware is Year 2000 compliant and customer-related information will not be at risk.
Send the letter to everyone who has any control over your financial and other personal records. For instance; Banks, Stock Brokers, Insurance Companies, Mutual fund companies, Mortgage company, Credit card companies, Loan Companies, Family doctor(s).
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