Equifax Stock Sales Are the Focus of US Criminal Probe (bloomberg.com)

An anonymous reader quotes a report from Bloomberg: The U.S. Justice Department has opened a criminal investigation into whether top officials at Equifax Inc. violated insider trading laws when they sold stock before the company disclosed that it had been hacked, according to people familiar with the investigation. U.S. prosecutors in Atlanta, who the people said are looking into the share sales, said in a statement they are examining the breach and theft of people's personal information in conjunction with the Federal Bureau of Investigation. The Securities and Exchange Commission is working with prosecutors on the investigation into stock sales, according to another person familiar with the matter. Investigators are looking at the stock sales by Equifax's chief financial officer, John Gamble; its president of U.S. information solutions, Joseph Loughran; and its president of workforce solutions, Rodolfo Ploder, said two of the people, who asked not to be named because the probe is confidential. Equifax disclosed earlier this month that it discovered a security breach on July 29. The three executives sold shares worth almost $1.8 million in early August. The company has said the managers didn't know of the breach at the time they sold the shares. Regulatory filings don't show that the transactions were part of pre-scheduled trading plans.

Comments

By all means do

[Ol Olsoc]

Then in perfected USA fashion, fire the Janitor, and give the guilty a big bonus.

Re:By all means do

[Seven Spirals]

Aww C'mon, they haven't replaced everyone with H1B's, pushed mandatory overtime on the survivors, thrown a million-dollar hookers & blow party, pumped and dumped the stock (much), bought a Ferrari with company funds, looted the 401k, laughed at hapless investors on "private" concalls, or properly sexually harassed all their admins.

So, they have lots of executive stunts left to pull.

Re:By all means do

[Ol Olsoc]

ISIS claimed responsibility for your credit report. ae911truth dot org

Hmm, must be paying the bills on time, tho...

If

[p51d007]

They can prove, they knew about the "hack" before they told anyone public, and sold their stock, they should be held accountable. But, in the white collar crime area, most get off with a slap on the wrist, or, at most, locked up in one of those country club style jails.

Re:If

[Anne Thwacks]

They can prove, they knew about the "hack" before they told anyone public, and sold their stock, they should be publicly executed

FTFY

Re:If

[Anonymous Coward]

Death sentence for making 1.8 million between 3 people. Not even stealing from people, just being more unfair than normal in pushing paper around. You're a fucking psycho.

Re:If

[Anonymous Coward]

You understand don't you that when you sell a stock, someone's on the buying end? It is exactly stealing from people if you sell a stock you know is about to plummet because of insider information. I wouldn't shed a tear if these guys were put to death (if guilty - see below).

And BTW, "they didn't know about the breach"? LOL, sure. "Hey Johnny, it's me Dave from security. Yeah, I can't give you any details yet but you might want to unload some stock if you can. Same
  to you buddy, you owe me one." There you are: they weren't informed.

Re:If

[Rakarra]

Death sentence for making 1.8 million between 3 people. Not even stealing from people,

It is stealing, but from many many people.

Equifax --admitted discovery-- on July 29th

[turkeydance]

exactly when they knew is unknown

Re:Equifax --admitted discovery-- on July 29th

[McGruber]

Bloomberg is also reporting that Equifax knew it had been breached back March, nearly five months prior to July 29:

In a statement, the company said the March breach was not related to the hack that exposed the personal and financial data on 143 million U.S. consumers, but one of the people said the breaches involve the same intruders. Either way, the revelation that the 118-year-old credit-reporting agency suffered two major incidents in the span of a few months adds to a mounting crisis at the company, which is the subject of multiple investigations and announced the retirement of two of its top security executives on Friday.

Equifax hired the security firm Mandiant on both occasions and may have believed it had the initial breach under control, only to have to bring the investigators back when it detected suspicious activity again on July 29, two of the people said.

Link: Equifax Suffered a Hack Almost Five Months Earlier Than the Date It Disclosed

Negligence or malfeasance - you pick

[JoeyRox]

So either these top-level executives were negligent in not knowing of a major security breach that others in the company likely knew or they broke securities laws by selling shares with material insider information.

Re:Negligence or malfeasance - you pick

[AmiMoJo]

Shane it's this that will get them prosecuted, not the fact that their incompetence fucked over millions of people.

Re: Negligence or malfeasance - you pick

[Anonymous Coward]

In America, the prosecution has to pick a charge and prove all its elements. If all the prosecution has is your dilemma then the executives walk. Plain and simple.

Re:Negligence or malfeasance - you pick

[amiga3D]

There's no law against being incompetent. There are laws against using info no one but a few have access to so you can reap vulgar amounts of money off of your incompetence.

Re:Negligence or malfeasance - you pick

[bluefoxlucid]

I'm amazed that people are all mad about the stock sales and everything. I mean, yes, that's illegal, but we have bigger problems--which we can fix (YouTube).

You can get a credit card or open up a car loan? You can afford $18. I wish the Neo would go Gen 4 with USB-C already; I'll probably settle for a 4C.

Re:Negligence or malfeasance - you pick

[Talderas]

According to Equifax's official procedures the execs should not have known about the breach. Additionally, there would have been a number of forms they would have had to fill out in order liquidate those stock assets. On the surface, it all looks clean.

What needs to be investigated is whether the execs had come about the information from other methods/sources and whether the disclosure by Equifax may have been delayed to allow for the stock sales to go through.

Guilty?

[Anonymous Coward]

How can they be guilty, they are executives.
 
No jail time. Slap on the wrist. Just don't do it again.

Wait a sec

[SuperKendall]

Just don't do it again.

Come on man, that's pretty harsh. They should just have a year cool down or so before they can rape shareholders and consumers for personal profit again, in accordance with long-standing tradition.

Pound

[Bodhammer]

"I hereby sentence you to five years in Federal pound-me-in-the-ass prison."

Re:Pound

[bluefoxlucid]

Are we sending executives to the pound now? I thought that was just for dogs.

just as common as a car crash on the highway

[k6mfw]

Just another hack with millions of people's data compromised, ho hum. And to think everyone first complains about too much regulation. With all these hacks, how about things like what Apple is really doing with future projects? (i.e. iphone has been in the works for decades). Or nuclear missile launch codes, what kind of words or character combination do they really use? Or Donald's taxes, Hillary's emails, ...

Confidential

[easyTree]

said two of the people, who asked not to be named because the probe is confidential

Unlike the personal details of 100M USAnians!

burn them

[zlives]

they are witches...

Corruption as Usual

[Required Snark]

Often executives with lots of stock equity want to cash some of it out. They then schedule a sale, so that if anything comes up that might make it look shady they can legitimately say that there was no insider information involved.

These asshats did not schedule the sales. If they did, they would have already made a public statement about their innocence. It's now obvious that the people under investigation are of the same caliber as the fools who just "retired". It's reasonable to assume that they found out what was going on and sold in a panic. Yes, they are that stupid and thought that somehow they would get away with it.

If you assume that any upper management at Equifax, or their competitors, are dumber then a box of rocks you will most likely be right. Credit reporting is under-regulated, monopolistic, and corrupt. Just like the rest of Wall Street. It's a system designed to make insiders rich and immune from all negative consequence. Stockholders, regular workers and clients are all expendable.

This environment always full of incompetent greedy psychopaths. If you doubt this, just look at the President.

Don't steal from the rich

[houghi]

Several million peoples data is on the line? Bad, but not as bad as stealing from the rich.
Increasing the price of medicine to absurd hights? Nice, but don't steal from the rich, because we go after you.
Fraud millions of people with shit loans and cause a worldwide economic disaster? Not nice, but don't steal from the rich, like Bernie Madoff.

Luckily you have a piece of paper that says "for the people, by the people" so that is nice. Keeps you hopeful.