The city of San Francisco has become the first U.S city to sue Equifax (EFX), one of the nation’s three major credit reporting firms. According to the news, this lawsuit has been filed in reference to historic data compromise at Equifax that exposed the personal information of about 143 million Americans.
The lawsuit accuses Equifax of being in violation of state laws that govern business practices, for failing to implement and maintain reasonable security practices, and for failing to provide a timely notice of the cyber attack. The notice issued by the San Francisco City Attorney Dennis Herrera says that Equifax failed to protect the personal data of more than 15 million Californians. The breach took place from mid-May to July, and the hackers were able to access Social Security numbers, names, birth dates and even driver’s license numbers.
“Equifax’s incompetence would be comical if the subject matter weren’t so serious,” Herrera said in a prepared statement. “This company fell asleep at the switch and upended the lives of millions of people.”
Per the statement issued by Herrera’s office, Equifax failed to take the necessary steps after discovering this breach, and it did not give timely information to the affected users from California.
“When you’re dealing with highly sensitive information, keeping your software up to date is such a basic step,” Herrera said, adding the company’s delay in informing users about the breach “made a bad situation worse.”
“Their delay prevented more than 15 million California consumers from taking immediate action to protect themselves from the risk of identity theft and fraud,” he said.
This breach has instigated multiple investigations at state and federal levels, including the Department of Justice in Atlanta.
Following this outbreak, Equifax CEO and Chairman Richard Smith stepped down from his position, effective immediately.
The CEO’s exit “doesn’t change the optics of its terrible data breach and its slow, inadequate and maddening response to its consumer victims,” said Ed Mierzwinski of consumer advocacy group U.S. PIRG in a statement.
Smith will be facing investigation and is scheduled to appear before the House and Senate next week to answer questions about the breach.
A spokesperson for Equifax told CNBC that while the company “cannot comment on pending litigation,” and it wants to “reassure consumers that we are remaining focused on helping them navigate the situation and providing the best customer support possible.”