Equifax’s recovery could be long and arduous after the gigantic data breach that saw around 143 million people have their confidential and personal information exposed.
Following the company’s attempts to clean up the mess, some believe that it may take much longer than expected to recuperate from the fallout of the breach. Unsurprisingly, one of the firm’s first actions was to follow the customary move of firing the CEO (with a cushy multi-million pension to boot) and hire a new one to take charge and sort out the problem. But when new CEO Paulino do Regos Barros Jr. was asked in a recent interview whether consumer data was now encrypted, many cringed when he was stumped and admitted: “I don’t know at this stage”.
Not the best start…
Analysts from brokerage and investment banking firm Stifel recommended that investors “hold” rather than “buy” Equifax stocks. Managing director Shlomo Rosenbaum, and associate analyst Adam Parrington, said they expect Equifax to still be scrambling in the mess the data breach left them in for most of this year.
This damning statement suggests that Equifax will not reach pre-breach figures until 2019.
Stifel analysts told investors in a statement: “We don’t expect resumption of growth-ier posture until the end of 2018 and into 2019.” They added: “We are now estimating 2018 and 2019 EPS of $5.60 and $6.09, respectively, which reflects 5.2% decline and 8.7% growth, respectively. In essence, our 2019 adjusted EPS estimate is now similar to what our 2017 adjusted EPS estimate had been prior to the data breach”.
Since the breach, New York Governor Cuomo has ordered that the Department of State add new consumer protection rules to protect Equifax customers. Among other directions, Cuomo required that the new regulations should require credit-reporting agencies like Equifax to respond within ten days to Division of Consumer Protection enquiries made on behalf of consumers.
Cuomo provided an explanation for his demands:
“The current status quo of allowing consumers to be penalised for having their data breached is unacceptable, and with the addition of these new protections, this administration will hold agencies accountable and help protect New Yorkers and their financial future.”
Another new rule would be to require Equifax and other credit reporting agencies to disclose all fees related to their identity theft protection products.
These rules should not be just unique to New York; they are completely reasonable and could be useful over here in the U.K. also. A company like Equifax has a legal responsibility to ensure that the personal data they hold and use is safe and secure. In violating that responsibility, victims have a right to claim for damages.
IMPORTANT: advice on this page is intended to be up-to-date for the 'first published date'.
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