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Equifax CEO Steps Down Amid Hacking Scandal (cnbc.com)
An anonymous reader quotes a report from CNBC: Richard Smith, CEO and chairman of Equifax, abruptly retired Tuesday following a data breach at the credit-reporting service that affected the personal information of 143 million people. Smith, who was 57 as of the company's proxy statement in March, became CEO and chairman in 2005 after 22 years at General Electric in senior roles in various divisions. He is to appear at a hearing of the Senate Banking Committee on Oct. 4 and is the only person scheduled to testify. He is also scheduled to testify next week at a hearing of the House Energy and Commerce Committee. Smith's salary for 2016 was $1.45 million and his bonus was $3.045 million. In a regulatory filing on Tuesday, the company said Smith will not get a bonus for this year and any other decisions regarding how his departure has been characterized or how much the company owes him will be deferred until the board completes an independent review of the breach and the response to it. In a separate report, CNBC notes that Smith could walk away with at least $18.4 million in pension benefits. The company is looking for a new CEO, naming its Asia-Pacific head to take on the interim CEO role.
just kick the can down the street.... i knew equifax was a target like any other big data warehouse... not surprised. it sucks.
like arthur andersen becoming Accenture amid the Enron scandal, so shall equifax. equifax will close its doors and rename and retool and if like Arthur Andersen foreign based HQ, will remove itself from the US.
i just wish the credit reporting companies would fix our credit rating since the 2008 mortgage crisis carte blanche because of WF telling everyone to stop making papyments to trigger a short sale.. in doing so... over 120 late is stuck and WF said they did not recommend it yet told everyone to do it, and now equifax and others have it pegged on your record that it was my fault not WF for going over 120...
yep, cry me a river.. thank you equifax for giving me another reason to file a complaint... and have my data breached..
the saying goes.. it's not if your data is breached, it is when you find out it was...
The CEO isn't being accused of insider trading, but I imagine resigning is intended to reduce the likelihood that criminal charges will be brought against him. If your business is being an information broker, and securing people against problems involving that data, then it's not just the CSO's responsibility to secure your data. If this data leak led to a sudden explosion of identity theft, and a corresponding outcry blaming Equifax, then there'd be pressure to do something more than slap some C-levels on the wrist 5 years down the line after appeals. I'm sure Equifax is carefully weighing if it'd cost them more or less credibility to shut down after selling their name and assets to a 'new' company that carries none of the liability for these breaches, seem to recall Hostess did that.
Corruption is convincing someone that the selfless ideal is the same as their selfish ideal.
On a semi-related note as a non-American, I've always found the setup of the american credit rating system to be weird in the context of american individualism/consumer-culture. Like, I understand why these companies exist and why lenders want access to such data, but it's interesting to me that they're allowed to collect and maintain these databases and hand out information without any consent from the individuals. This to me goes very much against the principles of the free market, where the consumer himself should have control over which services he's using to handle his credit.
Here in Finland we have a credit rating system that works so that credit rating companies only collect information on failed payments. That's, there's no 'positive' credit rating score for anyone, only negative marks on those who've failed to pay and have had a court order for the debt to be collected, or who're over 60 days late on payment. Once the debts have been successfully collected the entry is deleted in 2-5 years and the person again has a 'clean' credit rating. Banks and financial institutions can and do always check these records when they're processing a loan/credit application, but any further info like monthly income etc. has to be provided for them by the customer via their bank/employer.
Of course this is slightly more tedious than the american system as in it takes more effort from the individual than the american model, but in so far as i can see this has 2 major benefits:
1) It avoids weak points like this Equifax thing when sensitive information is not stored en mass by private companies but rather remains in the control of the consumer
2) It doesn't encourage people to use credit as much. Granted, my understanding of the American model is limited, so I may be mistaken, but it's my understanding that in order to improve one's credit score in the US, many people buy stuff more on credit to get their score up even if they have money to pay out of pocket and could use a debit card.
A sensible credit raring system in my opinion should not be encouraging people to take debt so that they can take more debt in the future, nor should it place such sensitive and valuable information to the hands of 3rd parties without consent.
"It is the business of the future to be dangerous" -Alfred North Whitehead