On Tuesday morning, chairman and CEO of Equifax Richard F. Smith announced his retirement. The company came under enormous scrutiny and criticism after news broke on Sept. 7 that a massive security breach may have exposed the personal details of up to 143 million people. Those details included such sensitive information as social security numbers, drivers license numbers, and credit card information.
The Equifax security breach is perhaps the largest such breach in U.S. history. According to Lily Hay Newman at Wired, the breakdown in warding off hackers compromised a company with "access to an extraordinary amount of personal and financial data for virtually every American adult." The sheer scale of that amount of stolen information is difficult to even contemplate, but one thing is certain. The odds that any given American adult with a credit card has had their information stolen are certainly higher than 50 percent.
As part of the company's strategy to qualm nerves, Equifax has offered free credit monitoring for up to to one year for anyone who may have been impacted. Apparently for Smith, that move was not quite enough to persuade critics that he should stay at the helm of Equinox. Paulino do Rego Barros, Jr. will serve as interim CEO while the company looks for a permanent replacement.
Apart from the enormous PR nightmare of having over 143 million Americans' most personal information stolen, three top officials at Equifax are also under investigation for insider trading. They sold shares totaling nearly $1.8 million a few days after Equifax internally uncovered the massive hack back in late July.
Then-Chief Financial Officer John Gamble sold stocks worth nearly $1 million. Then-President of U.S. Information Solutions Joseph Loughran got rid of $584,099 of company stock. And Rodolfo Ploder, then-president of workforce solutions, sold off $250,458 of his stock. All three former Equifax higher-ups sold their stock within days of the internal revelation on July 29 that the company had suffered a staggering cybersecurity breakdown.
Equifax has stated that none of the three men had been informed of the wide-scale hack prior to selling their stocks.
It's worth noting that the market price of Equifax shares fell significantly after news of the security breach broke on Sept. 7, 2017. Shared immediately dropped their value by 13 percentage points. Since then, share values have continued to dive, down now 33 percent from where they stood prior to news of Equifax's security failure.
Smith, who goes by Rick, has been the CEO at Equifax since 2005. Prior to coming on board at Equifax, Smith spent over two decades at General Electric Co., where he held several executive-level positions. He has served on several Boards in Atlanta, Georgia where he now lives. Smith graduated from Purdue University in 1981 with a BS degree. His compensation at Equifax reportedly came in at $1.45 million a year.
Experts estimate the stolen information taken by whoever was behind the Equifax hack will be circulating for many years to come. Up to 44 percent of the U.S. population will likely be hit with some kind of trouble from the fallout. That means that everyone should be scrutinizing their credit report for signs of any foul play, a vigilance that will be necessary to maintain for years, and perhaps even decades.
Suggested protection measures can include putting a security freeze on all accounts, as well as signing up for fraud alerts. Those alerts will force businesses to call and confirm your identity before a new account can be opened in your name.
How or if Equifax recovers from this enormous security boondoggle remains to be seen. Either way, Richard Smith is no longer in charge of that uphill mission.