A false news report on Twitter caused a brief panic for investors on Tuesday that triggered a sharp sell-off on Wall Street. A hacker made a false report about a problem at the White House.

If Twitter needed any more evidence that it has a serious security problem, this should do it: Stocks plunged sharply on Tuesday after a hacker accessed a news wire's account and tweeted about a false White House emergency involving explosions and injury to the President.

CNN reported The Associated Press' (AP) communications team quickly tweeted from its own account that the main AP Twitter was compromised, but investors had already panicked. The Dow Jones industrial average immediately plunged by more than 140 points.

After years of hacks that typically involved little more than obscene language, Twitter's failed security measures have now caused serious real-world consequences. While Twitter can't control certain issues, critics say the company could do more to prevent them.

Many hacks happen when account owners use guessable passwords or access Twitter over public Wi-Fi and shared computers. If one person who tweets from a corporate account loses his or her phone, an entire corporation's Twitter account could be at risk.

The AP incident appears to be an example of social engineering. A procedure known as 'phishing', where attackers pose as legitimate companies, such as Twitter, in an attempt for account holders to give up their passwords.