Equifax, one of top major consumer credit reporting agencies in the United States, is in deep trouble as over 20 reported lawsuits have been filed to date against the company. Reports show that the data breach may have “stolen personal information for 143 million Americans in one of the largest hackings ever.”
Privacy is something that most people today take very seriously, especially when it comes to the reporting of credit and using personally identifiable information to do it. The company’s leak of information allowed a cyber attack to occur by criminal hackers who had unauthorized access to information for nearly 44% of the U.S. population. The large class-action lawsuits prove that the leaks “signal the high legal stakes over the potential for identity-theft losses by millions of Americans whose personal data was exposed.”
The severity of the situation is immense. One specific complaint filed in San Jose, California, suggested that “Equifax might do this to lay a ‘foundation’ to pitch costlier services.” There are also reports that Equifax claimed more companies are “offering free or low-cost services such as credit scores, reports, and monitoring ‘as a means to introduce consumers to premium products and services.'”
In several comments related to the securities fraud lawsuit, Equifax was criticized and accused of “misleading shareholders about its ability to protect consumer data, inflating its financial statements and share price before the truth became known.”
John Coffee, a Columbia Law School professor and director of the school’s Center on Corporate Governance gave an interesting perspective on the situation. He shared his view on the devastating outcome of Equifax’s behavior in this statement:
“Equifax probably injured 143 million people, which is kind of a record.” Although the extent of the damage hasn’t yet been determined, “with 143 million people it doesn’t surprise me there are already 23 suits,” he said.
Shares of Equifax closed down 8.2% at $113.12 last Monday, which is an extension of Friday’s 13.7% plunge. The downfall of Equifax seems inevitable as the litany of impending lawsuits seem to be detrimental to the company’s public image and trust.