Equifax Settlement Money Going Fast After Data Breach: Officials

After Equifax offered victims of its data breach the option of up to $125 in cash or free credit-monitoring as part of a settlement, the company experienced what authorities called an "overwhelming response." Millions visited the data breach settlement site online to file claims in the week since the page went live, the Federal Trade Commission reported. Colorado residents will receive more than $3 million after the data of more than 2.5 million people in our state were compromised, according to Colorado Attorney General Phil Weiser.

More than 147 million were impacted by the Equifax data breach, officials said. A multi-state investigation into what is one of the largest breaches ever of consumer data showed that the sensitive information of an estimated 56 percent of adults was compromised after the company failed to patch a vulnerability in its security monitoring system.

As the breach went undetected for more than two months in 2017, Social Security numbers, names, dates of birth, addresses, credit card numbers and in some cases, driver's license numbers, were left exposed.

"Equifax acted recklessly by failing to take reasonable steps to protect consumer information they collected and stored. As one of the country's largest credit bureaus, Equifax collected and monetized highly sensitive information about all Coloradans," Weiser said in a statement. "Equifax's failure to protect that information is a clear violation of the Colorado Consumer Protection Act. This historic settlement sends a clear message that all businesses that collect and store confidential consumer information will be held responsible for how they protect—or fail to protect—that information."

Equifax agreed to pay a total of $425 million to individuals and $175 million to states impacted by the breach, in the settlement that was announced July 22.

Within the $425 million to individuals, federal officials say there is a $31 million cap on how much the Atlanta-based company can pay out to those seeking reimbursement for credit monitoring.

"A large number of claims for cash instead of credit monitoring means only one thing: each person who takes the money option will wind up only getting a small amount of money, nowhere near the $125 they could have gotten if there hadn't been such an enormous number of claims filed," according to the FTC.

According to the settlement, the $31 million will be divided equally among those who are eligible, so as more people ask for the payout, the amount will decrease for each person.

Theoretically, if 147 million people affected asked for the $125 payout and qualified, they would each receive $0.21.

"So, if you haven't submitted your claim yet, think about opting for the free credit monitoring instead," the FTC advised. "Frankly, the free credit monitoring is worth a lot more – the market value would be hundreds of dollars a year. And this monitoring service is probably stronger and more helpful than any you may have already, because it monitors your credit report at all three nationwide credit reporting agencies, and it comes with up to $1 million in identity theft insurance and individualized identity restoration services."

A separate pot of money is available for those who have paid out-of-pocket for services like hiring someone to help with identity theft or credit freezes, according to the FTC, which advised those people to use documents to submit their claims.

"There is still money available under the settlement to reimburse people for what they paid out of their pocket to recover from the breach,"the FTC said.
Benefits will not be distributed until at the earliest Jan. 23, 2020, a date set by the court.

What To Do If You Submitted A Claim Already

Those who want to change their preferred benefit to credit monitoring as opposed to the cash payment option can email the settlement administrator at info@EquifaxBreachSettlement.com.

People who have submitted claims already for the $125 payment will receive an email from the settlement administrator asking for the name of the credit monitoring service they are using. They should also anticipate not receiving the full $125 amount.

"Because of high interest in the alternative cash payment under the settlement, consumers who choose this option might end up getting far less than $125," the FTC advised.

What To Do If Impacted By The Equifax Breach

Equifax has a tool so people can check whether they were impacted by the Equifax breach and are eligible for part of the settlement.

Those impacted can file a claim with Equifax on the settlement page.

There is also a portal through the Federal Trade Commission dedicated to the Equifax data breach settlement, where the claims page became active Wednesday, July 24.

People must file claims by Jan. 22, 2020.

How To Protect Your Personal Information

For those who have been affected by this breach, there are steps that can help protect your information, according to the Federal Trade Commission and Georgia's Office of the Attorney General:

• Get a free credit report at www.annualcreditreport.com or by calling 877-322-8228.
• Call the Equifax Settlement Administrator at 1-833-759-2982.
• Take advantage of any free services being offered as a result of the breach.
• Use two-factor authentication on your online accounts whenever available.
• Consider a credit freeze.

Elizabeth Janney contributed to this report.

Related:

Equifax To Pay Over $3M To Coloradans In Data Breach Settlement