Security & Fraud

Intel Faces Lawsuits For Security Flaws In Microchips


A month after security researchers publicized security flaws in Intel’s microchips, along with those of other manufacturers, the company is facing 32 lawsuits over the vulnerabilities. Intel was not able to estimate how much those lawsuits might cost the company, Reuters reported.

The basis of many of the lawsuits is that Intel’s “actions and/or omissions” in relation to the flaws harmed Intel’s customers. As a result of the defects, hackers could potentially steal data from the computers of Intel’s customers.

In addition, three shareholders have alleged that Intel board members and other managers failed to take action on insider trading. Intel CEO Brian Krzanich sold 889,879 shares in November following a trading plan adopted in October, long before the flaw’s details became publicized. Still, Google said it notified companies affected by two flaws – called Spectre and Meltdown – last summer.

Intel was not the only manufacturer impacted by the flaws. Almost every electronic device powered by chips from Intel, Advanced Micro Devices Inc and ARM Holdings was impacted by the defects. And, even though the companies have released patches, some of the fixes have slowed down devices to the point that consumers might decide to buy replacements.

Still, Intel claims that most customers won’t notice an impact from the patches. Several companies – Amazon Web Services, Microsoft and Google – have released statements essentially agreeing with Intel.

Aside from legal implications, the flaws will likely result in cloud companies pressuring Intel to lower prices on chips in the future. “What (Intel’s cloud customers) are going to say is, ‘You wronged us, we hate you, but if we can get a discount, we’ll still buy from you,’” Fort Pitt Capital Group Senior Equity Research Analyst said in January. Forrest, whose firm owns shares in Intel, also predicts that Intel will increase its chip development spending to focus on security.



New PYMNTS Report: Preventing Financial Crimes Playbook – July 2020 

Call it the great tug-of-war. Fraudsters are teaming up to form elaborate rings that work in sync to launch account takeovers. Chris Tremont, EVP at Radius Bank, tells PYMNTS that financial institutions (FIs) can beat such highly organized fraudsters at their own game. In the July 2020 Preventing Financial Crimes Playbook, Tremont lays out how.