Experian T-Mobile Breach Sparks Class Action Lawsuits

Credit data company Experian has been slammed by numerous class action lawsuits after the recent breach of its North American servers that affected as many as 15 million T-Mobile customers.

While Experian didn’t disclose the number of pending lawsuits, it said it couldn’t assess the scope and effect of the various regulatory and government investigations on the company, according to Reuters.

The breach, which compromised a whole range of T-Mobile customers’ information, including their Social Security numbers, ID numbers and dates of birth, among other personal details, is now being reflected in the company’s latest earnings report.

The company reportedly saw its pre-tax profits slip down from $534 million a year earlier to $458 million for the six months to September, and its revenue took a hit as it fell down to $2.24 billion from $2.39 billion.

“We view the results as overall better than expected; the buyback, although relatively small, should be incrementally accretive (about 1 percent), and the slight increase in guidance, despite the macro-headwinds in some regions, should be also taken well by the market in our view,” Goldman Sachs analysts wrote in a note, Reuters reported.

To keep up, the company announced an extension to its $600 million share buyback program with a $200 million increment using proceeds from its divestments. The company also said it would pay an interim dividend of 12.5 cents per share.

Predicting growth in 2016, Experian CEO Brian Cassin said the company is foreseeing foreign exchange to be a headwind and expects mid-single digit revenue growth.

But for now, the company has a slew of problems arising from the data breach, including inquiries from senators and investigation committees asking for detailed information on the company’s plan of action.

“Experian has files on more than 220 million people. Protection of this information is of the utmost importance, especially because the scope of the information is vast and virtually no consumer can apply for credit without entering your system,” wrote Sen. Sherrod Brown (D-Ohio), a ranking member of the Senate Banking Committee, in a letter to Cassin, The Hill reported.

While the company is focusing on resourcefully dealing with the breach incident, it said it might be able to offset some of the cost from insurance recoveries in the event of an unfavorable outcome.

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