IN September 2017, Equifax revealed that approximately 147 million people had their personal data stolen by hackers who got through the consumer credit reporting company’s servers. Last week, the Federal Trade Commission (FTC) announced that a reached settlement would allow those affected to avail of certain services and compensation.
The settlement requires that Equifax pay at least $575 million in compensation to victims who had their personal data exposed from the Equifax data breach.
“An affected consumer is someone whose information was exposed in the breach, meaning that their name, address, social security number, or other personal information was actually part of the information that a hacker got their hands on,” said Jacqueline Connor, an attorney with the FTC.
There are several benefits available to those who were affected, one being free credit monitoring of up to 10 years, Connor told reporters in a telebriefing last week.
Of those ten years, at least four years of monitoring will be at three credit bureaus being Equifax, Experian, and TransUnion. Also included are up to six years of free monitoring of one’s Equifax credit report and $1,000,000 of identity theft insurance.
“That means if you’re a victim of identity theft and you discover it while you’re covered by this product, you can get up to a million dollars of insurance coverage for your out-of-pocket losses,” said Connor.
Those who were still a minor in May 2017 are eligible for a total of 18 years of free credit monitoring, according to the FTC.
Another category of benefits available to victims are reimbursements of up to $20,000 per person for time dealing with the breach, or other cash payments made a result of the breach.
Expenses include losses from unauthorized charges made to one’s accounts, fees paid to professionals like attorneys or accountants, costs from freezing and unfreezing one’s credit report, and costs for credit monitoring. Smaller expenses like document shipping expenses, mileage, phone charges, and notary fees can also be reimbursed.
For reimbursement of time spent on a breach, victims can be compensated $25 per hour up to 20 hours.
But claim amounts may be reduced, as limited funds are available during this initial claims period, according to the FTC. It said that during this initial claim period, a maximum of $31 million can be used for time spent dealing with the breach. That means if valid claims account for over $31 million, everyone with valid claims will receive an equal percentage of their claimed amount.
One other benefit breach victims can avail of is at least seven years of identity theft restoration services.
“I know that these three categories sounds like a lot and it might seem overwhelming to think about how to proceed, but I can assure you it’s simple,” said Connor, adding that she went through the processes of making claims herself.
No more cash payouts
The FTC originally offered an alternative cash payout of $125 instead of the free credit monitoring, but later withdrew the option due to an “overwhelming” public response.
“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,” explains the FTC on their website. “Nowhere near the $125 they could have gotten if there hadn’t been such an enormous number of claims filed.”
Consumer rights groups claim that the FTC engaged in false advertising when it announced the $125 payout option, as it was unlikely at the start that the reserved cash payout amount would be able to cover the affected 147 million people.
Demand Progress, an internet and social welfare focused consumer group, launched a petition to have the FTC investigate its sudden withdrawal.
“We demand the Federal Trade Commission and its Office of Inspector General launch an immediate investigation into the Federal Trade Commission’s false and deceptive advertising surrounding its settlement with Equifax,” reads the Demand Progress petition.
Acknowledging the issue, the FTC insists on its website that free credit monitoring would be of better value, emphasizing that people are guaranteed at least four years of free monitoring and identity theft insurance, among other services.
“The market value of this product is hundreds of dollars per year,” said the FTC. “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.”
Free credit reports for all U.S. consumers
Connor said that regardless of whether or not personal data was exposed as part of the breach, all U.S. consumers are entitled to six additional free annual credit reports from Equifax for a total of seven years. That’s a total of seven free credit reports from Equifax from January 2020 until December 2026.
“It is important because being able to look at your credit report lets you make sure that there are no mistakes or problems with your credit report,” said Connor, adding that identity theft was one problem that could be caught through frequent credit report checks.
“You can catch any misuse of your identity and work right away to stop it,” said Connor.
Filing a claim
The first step in the claim filing process is finding out if you were affected. The FTC has set up an online tool that allows people to find out by entering their last name and the last six digits of their Social Security number. Connor encourages people to try different variations of their last name to make sure they don’t miss out due to spelling errors or differences.
If one is found to have been affected, a file to claim money can be done on the Equifax Data Breach Settlement website.
“We are updating our page with current information and it contains the ability for a consumer to sign up for email updates and alerts,” said Connor.
“Most importantly, we have a direct link to the legitimate settlement website,” she added. “If a consumer is concerned about scams, they should go through our website so they can be confident they’re going to the right place.”
The website is www.ftc.gov/Equifax.