Security & Fraud

Equifax’s Chief Legal Officer Investigated Over Post-Breach Shares

A special committee at Equifax is now investigating its chief legal officer and his role in approving share sales made by four executives days after the company learned of its massive security breach.

According to a Reuters news report, three of the four executives sold a total of $1.8 million of Equifax stock days after the company discovered one of the largest data breaches in U.S. history, which leaked the personal and financial consumer data of 145.5 million people.

When Equifax disclosed the breach to the public, the company’s shares plunged as much as 37 percent, erasing billions of dollars from its market value.

The special committee – set up by the company’s board – announced last week that the investigation, which included 62 interviews and a review of over 55,000 documents, found that the four executives had no knowledge of the breach when they sold the stock, and pre-clearance for the trades was appropriately obtained.

“The conclusion that the company executives in question traded appropriately is an extremely important finding and very reassuring,” said Mark Feidler, non-executive chairman, in a statement.

But now the committee is looking into what John Kelley, Equifax’s chief legal officer, who was also in charge of security at the firm, knew about the hack at the time he approved the stock sales. Kelley is no longer in charge of security for the company.

The company did not immediately respond to requests for comment about the latest Equifax investigation. The U.S. Justice Department is conducting its own criminal investigation into the share sales.


Latest Insights:

Our data and analytics team has developed a number of creative methodologies and frameworks that measure and benchmark the innovation that’s reshaping the payments and commerce ecosystem. In the November 2019 Mobile Order-Ahead Report, PYMNTS talks with Dan Wheeler, Wahlburgers’ SVP, on how the QSR balances security and seamlessness to secure its recently launched WahlClub loyalty program.