The Independent Community Bankers of America (ICBA), which represents 5700 institutions, has filed a lawsuit against Equifax for its recent breach of 145.5 million consumer records and 209,000 payment cards.
The lobby group was joined by two of its members, Bank of Zachary and First State Bank in Barboursville, in asking the District Court for the Northern District of Georgia to require Equifax to compensate all community banks harmed by the breach and to improve its security.
In its third quarter filing earlier this month, the credit rating agency reported that it is facing more than 240 class-action lawsuits from consumers — in addition to suits from shareholders and financial institutions - over the massive data breach.
ICBA’s lawsuit seeks monetary relief for costs incurred by its members in clearing up the mess, including: protective measures to deter customer identity theft, deposit and loan account fraud, customer notification, covering fraudulent transactions, payment card cancellation and replacement, and other expenses.
The suit also calls on the court to direct Equifax to employ adequate security protocols to ensure the protection of personally identifiable information and payment card data.
“ICBA and the nation’s community banks are deeply troubled by the massive and preventable data breach at Equifax and its impact on community banks, consumers, small businesses and the economy,” ICBA president and CEO Camden Fine says. “Today’s lawsuit demands remedial action because Equifax needs to be held accountable for this massive and preventable catastrophic event.”
ICBA’s lawsuit alleges that the breach — in which hackers entered Equifax’s system through a known vulnerability to access names, Social Security numbers, dates of birth, and other information — was the result of a failure to heed warnings from security experts to properly secure its US website. The trade group is also enraged that it waited nearly six weeks to report the break-in to the public.
Sam Vallandingham, president and CEO of First State Bank, comments: “Equifax needs to be held accountable for this catastrophic event to protect the long-term security of our customers,” said