U.S. watchdogs fining Equifax $700 million for hacking 2017

Equifax, an American credit bureau, is likely to be fined $700 million by several American watchdogs. The reason is that the company was hacked in 2017, seizing the citizen service numbers and other sensitive information of nearly 150 million Americans.

If the settlement is indeed reached, the company must pay the fine to the Federal Trade Commission, the Consumer Financial Protection Bureau and most of the country’s attorneys-general. That’s what insiders say about the Wall Street Journal. Also, the settlement solves a class-action lawsuit.

Hack

Equifax was in the news in September 2017, when it became clear that hackers had entered its systems and gained access to sensitive consumer data. They included names, citizen service numbers, dates of birth and addresses. The hack exposed major security flaws at America’s largest credit bureau, and caused concern among consumers and policymakers. The hackers were able to enter the systems via a vulnerability that the company had not closed via a patch. There was also a scanning tool that didn’t work properly, allowing the hackers to stay in the network for months without anyone noticing.

Consequences

The hack had major consequences. Within a few weeks, the CEO stepped down and several investigations were started. The company’s executives were also criticized for waiting six weeks before announcing the hack. Questions also arose about how the company deals with the data of consumers it collects.

The planned settlement will create a fund to compensate affected consumers, according to the insiders. There will also be a website and a call centre to deal with the claims.

In addition, Equifax will be required to make additional changes to how it handles consumer data and how it protects them. The company will spend a total of $1.25 billion to improve its security systems and upgrade technology.