
FTC: Equifax might run out of cash, so please take the credit monitoring - fooey
https://www.cnbc.com/2019/07/31/ftc-equifax-might-run-out-of-cash-so-please-take-monitoring.html
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jpetrucc
It seems absurd that they only need to allocate $31 million for "alternative
payments" while the old CEO leaves with close to $20 million in bonuses [0],
while the rest of the money in the settlement is basically reserved for them
to pay themselves for their "free" credit monitoring.

This whole situation was a good opportunity to set a precedent for companies
not taking data security seriously. But they've instead shown everyone that
you can really just ignore all of that and hope it's never discovered - even
if it is, it's really just a light slap on the wrist. Combining this with the
recent Facebook fine [1], it really makes me think that the FTC has become a
complete joke.

[0]: [https://www.cbsnews.com/news/equifax-data-breach-
settlement-...](https://www.cbsnews.com/news/equifax-data-breach-settlement-
disgraced-former-ceo-getting-nearly-20-million-in-bonuses-after-the-hack/)

[1]: [https://www.theverge.com/2019/7/12/20692524/facebook-five-
bi...](https://www.theverge.com/2019/7/12/20692524/facebook-five-billion-ftc-
fine-embarrassing-joke)

~~~
triangleman
You had me until you mentioned the Facebook fine. $5 billion, assuming it
stands, is a lot of money and a good deterrent against the kind of behavior FB
was engaged in. No shareholder would be happy that their company lost that
much money. And before someone retorts with the fact that the stock went up
the day the fine was announced: shareholders could be happy that the
uncertainty is over, but still not happy with the fine.

~~~
bradknowles
Nah. They’ll make that back in a few minutes.

If you’re not talking about a sizable portion of their gross annual revenue or
their total market capital, you’re going to have little or no effect on any
corporation.

If you really want to have an effect on a corporation, the only way to do that
is to pierce the corporate veil, and hold the senior executives and the board
members personally liable. That will get them to change big time, and in a
hurry.

When you endanger the mega yachts and the private islands, you’ll get them to
sit up and take notice.

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situational87
$31 million is a laughably small amount of money to set aside for direct
settlements in the biggest hack in all of history. Add three zeroes to that,
probably still not enough.

I spent three days figuring out this nightmarish credit reporting system and
helping friends and family place freezes, as well as educating them to avoid
all the horrible dark patterns on Equifax's site. What I want is about $2000
and the ability to opt out of them owning and reselling my personal data
completely. I don't need credit monitoring, I don't need credit period
anymore, why am I forced into accepting the unlimited risk of them owning all
my data so that this private company can keep operating?

~~~
mason55
As part of the settlement you can charge for your hourly time that you had to
spend figuring out credit monitoring

~~~
mooman219
Comes out of the same $31 million. I'm unsure how distribution will work once
more than $31 million is requested, but you're likely not going to see the
full amount.

~~~
paulgb
My reading of the settlement is that of the $310 million, up to $31 million
(10%) is allocated to hourly time claims (section 6.2.6) and a separate $31
million is allocated to "Alternative Reimbursement Compensation", i.e. the
$125 cheques (section 7.5).

So it's still capped at the same amount, but comes from a different pool.

~~~
taborj
Either way, it's still a laughably small amount to set aside. They leaked data
on 147 million people, are they really only expecting 248k people to want to
be reimbursed? That's 0.0017% of the affected population.

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joshstrange
So this is some bullshit, if FB can get hit with a $5 Billion dollar fine then
I think we can scape up a little more than $31 Million from a company with
even less scruples than Facebook...

Also I already signed up for the $125 (when there was ZERO mention it might
not be paid out) so what am I supposed to do?

God I really wish they had just put down Equifax (as in killed the whole
company) as a statement to other companies: PROTECT YOUR DATA or we are coming
for you.

And NO I don't want their monitoring, if they couldn't keep my info safe to
start with why would I trust them with monitoring.

~~~
daybreak
> Also I already signed up for the $125 (when there was ZERO mention it might
> not be paid out) so what am I supposed to do?

From the FAQ, they'll send out an email to everyone who already filed allowing
people to switch to credit monitoring.

I agree, this is ridiculous. Even credit monitoring for life (from the other
agencies) would have been better than this.

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fooey
The FTC's FAQ that was updated:

[https://www.ftc.gov/enforcement/cases-
proceedings/refunds/eq...](https://www.ftc.gov/enforcement/cases-
proceedings/refunds/equifax-data-breach-settlement)

> 5\. I thought I could choose $125 instead of free credit monitoring. What
> happened?

> The public response to the settlement has been overwhelming. Millions of
> people have visited this site in just the first week. Because the total
> amount available for these alternative payments is $31 million, each person
> who takes the money option is going to get a very small amount. Nowhere near
> the $125 they could have gotten if there hadn’t been such an enormous number
> of claims filed.

> The free credit monitoring provides a much better value, and everyone whose
> information was exposed can take advantage of it. If your information was
> exposed in the data breach, and you file a valid claim before the deadline,
> you are guaranteed at least four years of free monitoring at all three
> credit bureaus (Equifax, Experian, and TransUnion) and $1,000,000 of
> identity theft insurance, among other benefits. The market value of this
> product is hundreds of dollars per year.

> You can still choose the cash option on the claim form, but you will be
> disappointed with the amount you receive and you won’t get the free credit
> monitoring.

For a little math, $31 million only makes it to 248,000 claims of the
150,000,000 people affected before it starts diluting.

~~~
kingnothing
If 150M people have suffered $125 in damages each, then Equifax needs to
either pay out the $18B or declare insolvency.

~~~
ronsor
after which their assets can be liquidated to pay off their debts to the
people

~~~
coldpie
As should the executives' assets.

------
hobs
"You might also be disappointed to learn that if you sign up for Equifax
credit monitoring, they sell your data + require binding arbitration
[https://www.equifax.com/assets/corp/consumer-privacy-
notice....](https://www.equifax.com/assets/corp/consumer-privacy-notice.pdf)
[https://pbs.twimg.com/media/EA1KK-
vUwAAmrnd.jpg"[0]](https://pbs.twimg.com/media/EA1KK-vUwAAmrnd.jpg"\[0\])

[0][https://twitter.com/hoofnagle/status/1156662788221050881](https://twitter.com/hoofnagle/status/1156662788221050881)

~~~
Fej
So taking the "free" credit monitoring is a net negative?

------
post_break
Nothing like being forced to use a company, who leaks your very important
information, who gets set a tiny amount of money to pay out for damages, only
to be told not to take it because that money might not be enough to pay
everyone who was affected.

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pssflops
I trust Equifax even less to monitor my credit safely than to pay out the
money they owe to consumers for their years of deception in business
practices.

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nathanaldensr
Supposedly the settlement encourages me to trust Equifax to monitor my
tradelines through "free credit monitoring"... but I can't trust the same
company to monitor the safety of that very same data.

Yeah, this makes a _lot_ of sense...

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calvinbhai
This settlement itself is a scam. It looks like a cunningly smart settlement
announcement.

Offer something that looks like a worthy settlement, drive millions of people
to get the cash option, then claim that too many are going for the cash
option, so they'll all get peanuts now (if 10 million chose cash option and
only 31 million is available, then it's $3 per head?).

That's a cheap way to get rid of any liability in the future.

Facebook didn't get hacked, and was fined $5 billion (do affected facebook
users get anything from that amount? not sure)

Equifax leaked extremely important details of persons, and was fined peanuts.
How does this make sense?

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gorbachev
I'm sure I'm not the only one actually wishing they run out of money. I'd be
happy to put them on a payment plan.

~~~
Operyl
It won’t work like that, though. It’ll just mean that the 125 the vast
majority of people expected will probably end up at 25 bucks each, depending
on how many people requested the cash payout.

~~~
bdcravens
If everyone eligible claims the $125, it's more like $0.25. Many won't, but
everyone will be lucky to receive enough for a cup of coffee.

It's all a sham. And they are still compiling all of our information so make
the next breach even better.

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mywittyname
We need The Corporate Death Penalty and we need to be able to enforce it in
such a way that intangible assets can't be copied over to another entity which
is left to continue operations. Hard assets can be auctioned and used to pay
unemployment claims and restitution.

Jail time for senior leadership would be nice too.

~~~
digitalsushi
How can we get a politician to vote for a corporate death penalty when faced
with tens, or hundreds, of thousands of now jobless constituents after its
first sentencing is upheld?

~~~
tareqak
Pay out several months of severance to each innocent employee.

~~~
anticensor
First nationalise the legal entity so that the board cannot block the actions.
Maybe pay a fair share of paid-for capital to employees, proportional to their
pays they earned for the last full payment period, as a severance (this might
result in lower-than-minimum severance, but better than nothing that you would
get in a regular bankruptcy). However, shareholders which would get more
dividends than this payout should only be allowed to be paid up to a week of
minimum wage in this severance payout, to avoid exit bonuses. Assets should be
auctioned off in a quick increment auction, to pay for debts to outsiders, and
IP rights to be available to public domain immediately before severance payout
starts. If any surplus money remains in the final account, it should be
transferred to the legislative to be used for anti-corruption investigations.
The legal entity can be vanished after all these finishes.

~~~
mrguyorama
Why should shareholders get a dime? They backed a shitty company, they should
also feel that pain. If they don't want to get hurt like that, they should
utilize their rights to keep dangerous and toxic people out of executive level
positions

~~~
anticensor
Shareholders may also have wage-related earnings due to managerial/executive
roles. Not all people are stock investors. A week of minimum wage is way less
than their initial investment in average.

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wpskidd
Dear FTC,

Duly noted that poor planing may lead to the exhaustion of the paltry reserves
Equifax set up for the actual victims of its crimes.

How about some real justice then?

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kayfox
I'm going to go for the check, because its something I can frame.

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urda
Yeah no Equifax can pay out, they don't need any additional protections for
their mistakes.

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simonsarris
The most insane thing is that they are _asking you to take the bet_ that
Equifax and companies like them will screw this up again by calling it a
better deal.

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dreamcompiler
Credit Karma will already monitor your credit for free. Letting Equifax do it
just lets them off the hook.

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not_a_cop75
"The FTC said Wednesday that consumers rushing to get a $125 check from
Equifax as restitution for its 2017 cybersecurity breach should consider the
credit monitoring option because the company could run out of money before
satisfying all the claims."

As someone that constantly watches credit brokers abuse a broken system, I'm
okay with this. Let their CEOs get their parachute pay. while their
reputations are publicly and privately castrated.

Honestly, as consumers, we can go after that too, if we really want.

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Simulacra
Equifax running out of cash? GOOD! Bankrupt the jerks.

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btreecat
LOL no

