FCA fines Equifax Ltd £11M for role in cyber-security breach
The UK Financial Conduct Authority (FCA) has fined Equifax Ltd £11,164,400 for failing to manage and monitor the security of UK consumer data it had outsourced to its parent company based in the US.
The breach allowed hackers to access the personal data of millions of people and exposed UK consumers to the risk of financial crime.
In 2017, Equifax’s parent company, Equifax Inc, was subject to one of the largest cybersecurity breaches in history. Cyber-hackers were able to access the personal data of approximately 13.8 million UK consumers because Equifax outsourced data to Equifax Inc’s servers in the US for processing.
The UK consumer data accessed by the hackers ranged from names, dates of birth, phone numbers, Equifax membership login details, partially exposed credit card details, and residential addresses.
The cyberattack and unauthorised access to data was entirely preventable. Equifax did not treat its relationship with its parent company as outsourcing. As a result, it failed to provide sufficient oversight of how data it was sending was properly managed and protected. There were known weaknesses in Equifax Inc’s data security systems and Equifax failed to take appropriate action in response to protect UK customer data.
Equifax did not find out that UK consumer data had been accessed until 6 weeks after Equifax Inc had discovered the hack. The firm was informed about the incident approximately five minutes before it was announced by the American parent company. This meant Equifax was unable to cope with complaints it received when the incident was announced and led to delays in contacting UK customers.
Following the cybersecurity breach, Equifax made several public statements on the impact of the incident to UK consumers which gave an inaccurate impression of the number of consumers affected. Equifax also treated consumers unfairly by failing to maintain quality assurance checks for complaints following the cybersecurity incident, meaning complaints were mishandled.
Patricio Remon, President for Europe at Equifax, said:
“Equifax has cooperated with the FCA fully throughout this long running investigation and has been recognised by the FCA for that cooperation, our transformation programme and the voluntary consumer redress exercise we implemented after the incident. Since the cyberattack against our company six years ago, we have invested over $1.5 billion in a security and technology transformation. Few companies have invested more time and resources than Equifax to ensure that consumers’ information is protected.
“We have built one of the world’s most advanced and effective cybersecurity programs. Our maturity level has exceeded all major industry benchmarks, and our posture – the ability to protect our networks, information, and systems from threats – has ranked in the top 1% of technology companies and top 3% of financial services companies analysed, for three consecutive years.”