Equifax came clean in 2017 about a significant data hack that compromised 143 million individuals. Given the kind of data infringed and the ensuing count of impacted individuals, this is among the largest and most catastrophic data breaches in history.
Names, social security numbers, birth dates, residences, and even in some instances driver's license numbers were among the data acquired in the Equifax hack. With this kind of individually identifiable data, hackers might potentially commit identity theft and associated fraud.
This part should draw attention to the precise manner the Equifax data hack happened
One of the acknowledged national consumer credit reporting companies in the United States of America is Equifax. To provide credit rating and credit reporting services to creditors and businesses, they track and document credit behavior and consumer credit transactions. For hundreds of millions of individuals, they thus contain rather sensitive information.
This was discovered to have happened in 2017 between mid-May and July; the exploit came via an Apache Struts application flaw. Java-based web applications are developed using Apache Struts; the particular flaw the hackers were able to exploit was connected to the file upload capability of the application.
The security experts criticized Equifax for failing to install the fix for this vulnerability when the Apache Software Foundation published it in March 2017. Should the business have followed the recommended guidelines for software, this breach may not have occurred in the first place.
Another element allowing the breach to take place was the lack of encryption of customer data, which should have been encrypted to protect them. Once the Equifax systems were within reach, data not encrypted enabled the hackers to move vast volumes of data the instant they had an opportunity.
The Consequences of the Equifax Data Breach
As a result of the break, millions of Americans had to protect themselves and begin the process of guarding against identity theft. Equifax built a website for consumers affected to check if they were impacted; the website received such a large influx of traffic that it crashed multiple times in the days after the announcement.
This exposes identity theft and other forms of fraud and for this reason, it would be a concern for several more years. More so, when some of these numbers are stolen especially the Social Security Numbers, they represent a constant threat since there is no way that consumers can change the numbers.
In addition to making people aware of criminal activities, the breach loss does not come cheap at all. In addition, Equifax also provided free credit monitoring to those affected for the next year, but even with credit monitoring, individuals must pay attention to their accounts for signs that they have been compromised. People also have the responsibility of placing fraud alerts and freezing credit reports if possible.
Legal Fallout for Equifax
The repercussions that Equifax experiences are not only the reactions from the targeted consumers and the organizations. The security standards and response of Equifax to the breach were subject to investigations conducted by both federal and state commissions. Some doubts still exist about the protection of such information whether they had adequate controls around it and whether they informed the public early enough after the breach.
Equifax was also ordered to pay at least $700 million to the Federal and state authorities in July 2019 as a fine in connection to the data breach cases. However, it was the Federal Trade Commission that took the lead in the probe into Equifax’s lack of consumer data protection. Equifax also committed to enhancing its information security program in compliance with the settlement.
Under the settlement, Equifax agreed to pay USD 425 million to the consumers to compensate for the loss that resulted from the breach and credit monitoring services for free. The rest of the fine was split between states and federal agencies. Nevertheless, some sought to know if the fine was sufficiently gargantuan in light of the gross violation and the total price that all stakeholders stand to pay.
Consumer class actions have also been filed against Equifax by clients who feel they were prejudiced or whose risk of being defrauded rose after the breach. There were several proposed class action cases based on these facts, and a federal judicial panel decided to transfer them to the courts in a single case. These lawsuits pose significant threats to Equifax if it loses them since it may lead to more significant financial risks.
Preventing Future Breaches
Over the past few years, legislators, as well as consumer protection organizations, have been demanding stronger federal standards regarding data security. These efforts gained traction with the Equifax breach and put into perspective just how precarious data security is in both government and private organizations.
Following the leak, Elizabeth Warren and Mark Warner proposed a new bill called the FREE Act or The Freedom from Equifax Exploitation Act. It also recommended that credit reporting agencies should be provided with cybersecurity guidelines and measures and that when such organizations neglect to protect consumer information, they should be punished severely.
Although it has not yet become a law, the bill describes the kind of reform that is needed by many professionals to enhance IS and ensure that enterprises are given a significantly stronger financial motivation for investing in data protection. Thus, enforcement of regulations beyond the fines’ imposition level still appears quite reactive and is possible only once a significant violation leads people to danger.
The breach of Equifax is often cited as an example of global exposure of private data in the current world. For consumers, the episode was a wake-up call to always ensure they conduct frequent checks on bank and credit card statements and if all fraud is perpetrated on them, to apply all possible measures of identity protection to minimize the effects. Now businesses and government institutions with personal information on their clients or employees are under the spotlight to ensure cybersecurity measures and system safeguards are in place before a data leakage occurs. If reforms do arise from the wreckage of the Equifax scenario, the net result could be to avoid or mitigate other cyber assaults which otherwise could impact millions of other consumers even more.
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