Magazine article Independent Banker

Into the Breach

Magazine article Independent Banker

Into the Breach

Article excerpt

ICBA never flinches from its responsibility to stand up for the nation's community banks, so we didn't hesitate to file suit on behalf of the industry following the massive data breach at Equifax. Joined by Bank of Zachary in Zachary, La., and First State Bank in Barboursville, WVa., the lawsuit is designed to address the long-term damage to community banks posed by the breach of 145.5 million consumer records and 209,000 payment cards.

The Equifax breach is deeply troubling not only because of its scale but also because of the failure of Equifax to take basic steps to protect itself and consumers from such a preventable catastrophe. The breach-in which hackers entered Equifax's system through a known vulnerability, gaining access to names, Social Security numbers, dates of birth and other information-was caused by Equifax's negligence. Quite simply, the credit rating agency failed to heed warnings from security experts to properly secure its U.S. website. Further, Equifax waited nearly six weeks to report the breach to the public.

We do not yet know the full extent of the damage, but there is no doubt about the cost to community banks. ICBA's lawsuit asks the U.S. District Court for the Northern District of Georgia-Equifax is based in Atlanta-to require the credit bureau to compensate community banks for the costs they will incur in responding to the breach. That includes the costs of customer credit freezes, protective measures to deter fraud, and canceling and replacing payment cards. …

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