How Equifax “Got Everything Wrong”

Forbes contributor Davia Temin takes a look at how credit agency Equifax responded after suffering a hack that exposed personal information of 143 million people and finds a mess. From a tepid CEO apology to “a completely botched announcement of remediation, tying use of their free credit monitoring to forfeiting the right of a trial, and mandating arbitration,” the company’s response was a case study in how to do it wrong, according to Temin. (In his initial apology CEO Richard Smith said the breach – which exposed social security numbers, driver’s license numbers and credit card information – was “clearly a disappointing event for our company.”) Meanwhile, by looking at regulatory filings, Bloomberg investigators found that although it took the company more than a month to disclose the breach, three company executives had sold more than $1.8 million in stock within days. The three include the company’s chief financial officer, who sold shares worth almost $1 million on August 1. That was two days after the company, according to its own announcement, discovered the breach. According to Bloomberg’s findings, none of the three executive transactions were part of a scheduled 10b5-1 trading plan. Is a statement, the company said the shares that were sold represented only a small percentage of the executives’ company holdings and that they didn’t know about the breach at the time they sold.