More than £1 bn costs for Equifax following breach

News by Doug Olenick

Equifax estimates it has spent about US$1.4 billion (£1.1 billion) recovering from its 2017 data breach that exposed the personally identifiable information of 148 million customers.

In Equifax’s latest Security and Exchange Commission filing the company is estimating it has spent about US$1.4 billion (£1.1  billion) recovering from its 2017 data breach that exposed the PII of 148 million customers, according to a recent report.

This includes a US$ 690 million (£533 million) charge made during the first quarter of 2019 related to outstanding litigation and potential fines related to its 2017 cyber-security incident. The funds will be dedicated to covering legal action brought by US federal and state regulators and US federal class action cases, said Mark W Begor, Equifax’s CEO, during an earnings call made last week. Berger also told investors the company reached confidential settlement covering the consumer federal class action cases that if approved by the court will resolve and dismiss the claims asserted in the consumer cases.

"The proposed global settlement provides for the establishment of a single consumer redress fund, which was our goal and certain other non-monetary terms. As we’ve discussed previously, we believe the consumers are better served through a single consumer fund and a global settlement of the federal and state government investigations, together with the consumer class action litigation. We expect to complete definitive settlement agreements with the parties in the coming weeks," he said.

There were also several one-time costs incurred during the first quarter related to the breach, US$ 83 million (£64 million) for technology and security spending, US$ 12 million (£9 million) for legal fees and US$ 2 million (£1.5 million) for consumer support, Berger reported.

However, the incident will continue to impact the company’s balance sheet for the foreseeable future.

"While this charge represents our current estimate to resolve many of the significant issues facing the company, we expect to incur additional losses associated with the other claims and litig.ation related to the 2017 incident. We will continue to work with all parties to bring these matters to closure as soon as possible, while balancing the needs of our Company, employees, customers and shareholders," Berger said.

This article was originally published on SC Media US.

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