Credit reference agency Equifax has warned investors that profits have tumbled in the aftermath of a catastrophic cyber attack earlier this year, which was only revealed in September.
The attack spilled sensitive details of around 145 million Americans, as well as more than 15 million UK accounts.
In a statement issued yesterday evening, the company warned that it is now in the process of dealing with more than 240 class-action lawsuits and 60 government-linked inquiries.
Not surprisingly, it warned investors that it has dramatically increased its spending on security, as a result - as well as on lawyers.
Quarterly profits at the firm fell by 27 per cent, while revenue also fell below analyst expectations, with some commentators suggesting that the company could even go out of business in the aftermath of the cyber attack
In total, revenue in the latest quarter grew by four per cent to $834.8m, although the company had briefed investors that revenues would grow by six per cent.
The cyber attack has already cost the company $27.3m, on top of the $56m cost of free credit monitoring dished out shortly after the attack. This cost could reach $110m, the company warned.
US customers will be able to access the TrustedID Premier credit monitor service for free over the next year, but that's unlikely to be enough to salvage the company's tarnished reputation.
Paulino do Rego Barros, who took over as interim CEO in September when former CEO Richard Smith left shortly after the attack, said that the company had invested a great deal of money and resources to improve its security and to ensure such an incident never happens again.
"Our teams have taken immediate actions to improve our data security and provide improved support for consumers who were impacted by our cybersecurity incident," said Barros unveiling the company's third quarter results.
He continued: "I have committed Equifax to four things: protecting consumers, enhancing our security, empowering consumers to control access to personal credit data, and leading our industry to confront the massive economic and national security threats represented by cyber criminals."
He added that the company has hired a team of cyber security specialists to ensure that it is following the right strategies to protect account data, and is deploying a range of vulnerability- and intrusion-detection tools.
"We recognise that we have an important journey in front of us to regain the trust and confidence of consumers and our business customers," the company admitted in its statement, reported by Bloomberg.
But, it admitted: "Certain of our customers have determined to defer new contracts or projects unless and until we can provide assurances regarding our ability to prevent unauthorised access to our systems and the data we maintain."
James Barrett, senior director EMEA of Endace, said: "The recent Equifax hack was not the biggest hack in recent years, but was probably the most dangerous.
"Enough of consumers' personal data is now in the wild that their identities can be stolen, and it took two months for Equifax to confess, which means that those people were at risk without knowing it.
"From a technology point of view, the reality is that most breaches are preventable. In this instance, it is speculated that the breach was made possible by an Apache Struts vulnerability first announced in March.
"However, there will always be breaches that cannot reasonably be prevented, and for these a solid remediation plan is needed."
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