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Equifax’s woes continue, loses CEO

(FinancialPress) — Equifax (NYSE: EFX) CEO and chairman of the board Richard Smith has called it quits, as per an announcement released by the company on Tuesday.

Smith was at the helm of the credit company when the gargantuan data breach that compromised the information of 143 million citizens occurred. The company has remained besieged ever since the security failure was disclosed earlier in September.

He is third in a series of resignations that also saw the company‘s chief security and chief technology officers vacate. The announcement had been released on Sept. 15th – a Friday.

Mark Feidler, a current board member of the company, will take over as executive chairman of the board while a replacement is searched for both internally and outside of the organization.

Trading of the company stock was halted in pre-trading hours, before the announcement. Since, its value has dropped 2% in this session. Since the data breach was made public, company stock has lost around 25% of its pre-disclosure value.

Equifax has been in the eye of a scrutiny storm after it was revealed that they were aware of the vulnerability months before the breach happened, yet didn‘t effectively correct it. Specifically, the report in which this came to light showed that the issue came to light at the very least in March 2017. They also noticed “suspicious network traffic“ in July – close to six weeks before making the unfortunate event public.

Adding fuel to the fire, suspicions of insider trading arose after it was revealed that three execs sold company stock in early August – before the breach reveal. The company has stated that these executives had no knowledge of the incident. This was not a convincing argument for the 36 U.S. senators that have demanded that regulators investigate the sale of that stock.

Unbelievably, that‘s not the end of the rap sheet. The complimentary ID-theft monitoring program offered by Equifax, TrustedID, had a clause in its Terms of Service that forced the client to waive their right to sue or join a class action lawsuit by agreeing to them.

The punchline to their woes though was, as reported by Gizmodo, that the company directed customers to a phishing site similar to their equifaxsecurity.com page that was set up in the aftermath of the breach.

 

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Written by Financial Press

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