Credit reporting company Equifax Inc. suffered a massive data breach in 2017 and was recently ordered by the court to offer $700 million in settlement to consumers. However, the victims of the breach may still have to face a long and cumbersome process before they could get paid.
What do the consumers have to do?
As per officials at the Federal Trade Commission (FTC), the 147 million consumers who had to spend time or money to protect themselves from identity theft or similar issues after the September 2017 data breach should be entitled to compensation. The consumers can also get paid for the time spent on responding to the breach, which is at $25 per hour for up to 20 hours.
Self-certification by the consumer is valid for 10 hours, but they must provide documentation for the next 10 hours. The time spent addressing the fraud issues or identity theft after the breach, which includes freezing credit reports and seeking credit monitoring, can be reimbursed as well.
More benefits for the consumers
Equifax will be converting the cost of the last four years of credit monitoring all three credit bureaus, i.e., TransUnion, Experian Plc and Equifax itself. It would also cover $1 million in identity theft protection and an extended six years of credit monitoring. Those who were Minors during breach will get free credit monitoring for 18 years.
The chairman of the settlement committee Normal Siegel from Kansas City-based Stueve Siegel, who led the negotiations for consumers in the class-action suit said, “That is a significant benefit. We have also tried to make this process as simple as possible.” The settlement is still awaiting the court’s approval.
Note that Equifax settlement documents suggest a $700 million settlement deal of which about #400 million will go directly to consumers. Documents from a Federal Court in Atlanta suggest that consumers affected by the 2017 breach will get paid an additional $125 if the initial funds are not enough. The balance will be paid as fines to the Consumer Financial Protection Bureau and state authorities.
Individual victims will have to prove that they were harmed because of the breach to receive about $20,000 in compensation. The details about the process are still unclear, but consumers will have to submit claims alongside documentation to prove that they spent time or money on credit-monitoring due to the breach. They could include telephone records, receipts, invoices, bank statements, and credit card statements for the same. All claims will be handled via a new website after the court approves the settlement.