2.5 million more consumers affected, ex-CEO faces Congress

Former Equifax CEO Richard Smith came under harsh questioning Wednesday at a hearing of the Senate Banking Committee the second of three congressional hearings on Equifax being held this week

Smith, who stepped down last week as Equifax's chief executive, appeared Tuesday before a House subcommittee that is investigating the breach.

"All the folks in the executive suite had no clue, but they were the luckiest investors on August 1 to sell the stock at the best price to net $655,000 - this was pure luck and nothing else?" a baffled Scott asked former Equifax CEO and Chairman Richard Smith.

Equifax faces legal claims in dozens of states over the breach, which exposed data including dates of birth, Social Security numbers and credit card information.

Slate reached out to an Equifax representative, but we have not yet received a response.

On top of that, Smith failed to ask basic questions when he was notified of suspicious activity on July 31.

The company was also slammed for charging individuals to check to see if they were affected, while its credit monitoring site was deemed susceptible to hacking and accidentally sending data breach victims to a fake phishing website for weeks.

"Until we get those answers, Equifax should not be rewarded for reckless data protection with a $US7.25 ($9) million IRS contract".

On a website for affected US consumers, Equifax explains that the complex and time-consuming investigation is behind the delay between its discovery of the breach and disclosing it. The company said it would update the database with the names of the additional millions of potentially affected consumers by October 8.

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Smith's 12-year tenure at Equifax came to a stunning end last week when he abruptly retired, replaced in the interim by Paulino do Rego Barros Jr., an executive from the company's Asia Pacific division.

Equifax routinely touted its ability to shield the data from prying eyes.

"I'm here today to say to each and every person affected by this breach: I'm truly and deeply sorry for what happened", Smith said. He said he was alerted the following day, but was not aware of the scope of the stolen data.

The company said hackers found the weakness and exploited it to gain access to names, Social Security numbers and other sensitive personal information.

Smith also said the sales occurred after quarterly earnings were reported, which is a common practice within the company.

After the data theft was disclosed to the public more than a month later, Equifax's stock dropped about 36 percent, wiping out more than $6 billion of the value of investors' stake in the company.

"This could have been avoided if you had taken the simple step of doing security patches", said Brown. "If you think you're safe, that's probably when you're not", he said. "Equifax was entrusted with Americans' private data and we let them down".

Since the breach, Equifax has been offering a credit lock to those affected, which would prevent the sales of information to other companies, though the information that was taken was kept in a portal that was not encrypted.

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