Why All Americans Need the Tort System, And Accountability for Wrongdoing.

The news that up to 143 million Americans’ private data and personal information has been hacked is shocking.  What is worse are the details.  And what is still worse, are corporate efforts to avoid being held accountable for the damage that this catastrophic breach has caused, and may continue to cause.

Here’s what we know:  Equifax is a credit checking company that collects and holds sensitive personal information: social security numbers, credit card numbers, and other personal data, for tens of millions of Americans.  On July 29th, Equifax learned that it had been hacked, and that the sensitive personal information of up to 143 million Americans had been compromised – stolen, and was now available to hackers. This was a major, major security breach.

Shockingly, it was not until September 7th, that Equifax notified the world that it had been hacked; five weeks before Equifax filed an 8-K.  (This is a governmental filing meant to inform investors of a material event, in this case the loss of private and confidential information of 140 million Americans).  This delay is unfathomable and unacceptable.  The hackers who stole the information had five whole weeks to make use of it, before the government was even notified.

And, to make matters worse, the Congress is considering a bill that would shield companies like Equifax from being held accountable for credit reporting abuses.  Representative Barry Loudermilk, who is a Republican congressman from Georgia, has proposed H.R. 2359, a bill that would favor credit companies like Equifax over harmed consumers. In a press release calling for Congressman Loudermilk to withdraw the bill, representatives for the National Association of Consumer Advocates noted that the bill

would amend the federal Fair Credit Reporting Act to essentially shield credit reporting agencies from full accountability for willful and reckless conduct that upends individuals’ employment and financial lives.

     Specifically, the ‘FCRA Liability Harmonization Act’ would eliminate punitive damages, a tool used to punish the worst actors, and would impose an arbitrary $500,000 limit on statutory and actual damages in class actions. These illogical blocks on consumer remedies would obstruct individuals’ legal rights.

Equifax has set up a website where consumers can go to learn if they have been hacked, but as consumer advocates have noted, use of the website may lock injured parties out of the courthouse, since Equifax has

inserted forced arbitration clauses in the terms and conditions of various credit monitoring services that it is encouraging affected consumers to enroll in.

     “Equifax’s use of forced arbitration clauses and class action bans means that consumers cannot band together in court to seek remedies against it,” said Liz Coyle, executive director of Georgia Watch.  “This is unacceptable and will have disastrous effects on the marketplace.”

This is why we have a system of civil justice; where we can go to trial in a court of law, before a jury of our peers, and obtain full justice; where we have the right to hold corporate wrongdoers accountable, in the same way that a drunk driver should be held accountable.

Are you one of the 143 million Americans at risk of identity theft because of this breach?  What are you going to do about it?

What You Can Do

Here are several things you can do to protect your rights: