13
Feb
2018

Equifax data breach probes could affect insurance coverage

Business Insurance

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Investigations into the Equifax Inc. data breach by one or more regulatory bodies could affect an insured’s ability to obtain coverage, but a news report has indicated that a key federal regulator has not taken steps to investigate the incident.

Reuters reported on Feb. 5 that Mick Mulvaney, head of the Consumer Financial Protection Bureau, has pulled back from a full-scale probe of how Equifax failed to protect the personal data of more than 145 million consumers, with the agency to date not issuing subpoenas against Equifax or seeking sworn testimony from executives and shelving plans for on-the-ground tests of how Equifax protects data.

While not directly addressing the report, the CFPB maintains it is “committed” to protecting consumers.

“Acting Director Mulvaney takes data security issues very seriously,” John Czwartacki, senior adviser to the acting director, said in an email statement. “Under his direction, the CFPB is working with our partners across government on Equifax’s data breach and response. We are committed to enforcing the law. As policy, we do not confirm or deny enforcement or supervisory matters.” The reported inactivity has drawn the attention of 31 senators who sent a letter to Mr. Mulvaney on Thursday demanding answers about why the CFPB halted its investigation into the data breach.

“We are deeply troubled by recent news reports that, under Director Mulvaney’s leadership, the CFPB may have stopped its investigation into the Equifax breach,” the senators said in their letter.

An investigation by the CFPB could help establish facts about the breach that could be used by insureds and even plaintiffs.

“It definitely has a bearing on insurance coverage,” said Daniel J. Healy, a partner with Anderson Kill L.L.P. in Washington, D.C.

To read the full story:  Equifax data breach probes could affect insurance coverage

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