The Equifax Settlement is Highway Robbery
It's been awhile since I've written anything. Apparently I haven't had anything useful to share and my righteous indignation was backburnered so as to not spout off about various consumer or criminal defense topics. Well, today I've got both. In spades.
What Did Equifax Do?
So, as you may have heard, Equifax (one of the three credit monitoring companies that we never agreed to let collect our data but have made a small fortune aggregating it and gatekeeping it), suffered a massive data breach in 2017. The breach effected 147 million people. The United States has a population of 325 million (248 million of which are adults), so a little bit under half of all people and well over half of the adult population.
What is this Settlement?
As you might have heard, the FTC and Equifax reached a settlement where Equifax would pay for credit monitoring for people or pay a settlement of $125.00 to people who already have credit monitoring. The settlement set aside $31,000,000.00 to pay people. Doing a little bit of back-of-the-envelope math, that means they set aside enough to pay a maximum of 248,000 claims in full. That's only 0.17% of the people who actually had their data compromised.
Of course the settlement is proportional, so if more than 248,000 people claim the settlement, the amount per person goes down. If all 147 million people took the monetary settlement, each would be entitled to a whopping +/- 20¢.
The FTC is Toothless at best
Funny story, the Federal Trade Commission has explicitly told victims of the breach that they aren't going to get that much because of the paltry amount set aside and that credit monitoring is "worth hundreds of dollars and comes with identity theft insurance and restoration services".
"But Chad, wouldn't most people take the credit monitoring if it's worth hundreds of dollars?"
In theory, maybe. But most credit cards come with a free credit monitoring product of some variety because those types of products cost almost nothing (comparatively) to administer, but they're a nice value-add for the customer. Also, so many breaches have happened in the past that pretty much every living human walking on earth has some kind of free credit monitoring available to them. So a lot of consumers already have credit monitoring and don't need more. And most importantly, it doesn't cost Equifax a damn thing to offer it.
So what now?
The settlement between the FTC and Equifax is a joke. But it is still subject to objections and to a fairness hearing. Ideally, it will be shot down as being a laughable settlement for a massive breach. I'm personally debating objecting to the settlement. Maybe you should too. Objections are due by October 19, 2019. The hearing on fairness is currently set for December 19, 2019 at the time of writing.
So, as with all things, the general advice is some variation of "sue the bastards". In this case, you can object to the FTC settlement. Because it’s pathetic.