Court Approves Equifax Breach Settlement: Money for Some, Free Credit Monitoring for All
Last updated February 7, 2022
Equifax will pay up to $425 million in restitution to those directly impacted by the massive data breach of the credit bureau in 2017. A federal court gave final approval to the class-action lawsuit settlement in mid-January. Settlement notices are now being sent to those who previously filed claims for monetary compensation or free credit monitoring. The court also awarded $80 million in attorney fees.
Listen to audio highlights of the story below:
The breach was one of the largest in history, exposing the personal information of 147 million Americans. Hackers stole sensitive personal identifying information, including Social Security numbers, birth dates, and—in some cases—driver’s license numbers and credit card numbers.
The lawsuit, filed by the Federal Trade Commission, Consumer Financial Protection Bureau, and all 50 states, claimed Equifax failed to secure the personal information it had gathered, and delayed notifying victims about the breach.
Equifax denied any wrongdoing, but the company agreed to make restitution to those with qualifying claims, and to provide four years of free credit monitoring to anyone who had their information stolen.
“At first glance, the settlement sounds great,” said Brad Shear at Shear Law, an attorney who specializes in privacy and technology issues. “However, when you read the fine print, you realize that even if you can prove you have up to $20,000 in direct losses tied to the breach—which is a big if—you may be offered just pennies on the dollar if there are many other claimants with similar losses.”
It is too late to exclude yourself from the settlement. The deadline for that was Nov. 2019.
Is It Legit?
Notification letters and emails are being sent to anyone who filed a claim as part of the settlement by Jan. 22, 2020. The notice reads:
You filed a claim in the Equifax Data Breach Settlement and chose to receive free, three-bureau (Equifax, Experian, and TransUnion) credit monitoring from Experian for four years. Implementation of the Settlement was delayed by appeals; however, the Settlement is now effective because appellate courts have affirmed it. This email provides additional information about the services provided by Experian as part of the Settlement and how you can enroll You are receiving free membership in Experian IdentityWorks? for four years. You must enroll by June 27, 2022.
This service is free for you and provided as a Settlement benefit. You do not need to provide any payment information to enroll and you do not need to cancel the service when it ends. We encourage you to enroll today.
How to Enroll:
- Visit the Experian IdentityWorks Website: www.experianidworks.com/equifaxsettlement
- Enter Your Activation Code: (12-digit code provided)
Skeptical consumers may question if the email is legitimate or just another clever phishing scam. That’s what I suspected when I got my email.
Eva Velasquez, president/CEO of the non-profit Identity Theft Resource Center, cautions that scammers are likely to take advantage of the settlement.
“Keep in mind that you are going to have to authenticate yourself and provide some of your personal information when you enroll,” Velasquez told Checkbook. “That's why it's really important to make sure you’re looking at a legitimate email. The email should be coming from [email protected] If it's not coming from that email address, don't engage.”
Red Flag Alert: No one will ever call you about the settlement, and you will never be asked for any money.
What Equifax Agreed to Do
Those who filed a claim by the Jan. 2020 deadline are entitled to:
Free credit monitoring: At least four years enrollment in Experian IdentityWorks. You will not be asked to provide any payment information to enroll. Any correspondence that asks for payment is a scam. You can enroll online at www.experianidworks.com/equifaxsettlement or by calling 1-877-251-5822. You will not need to cancel the service once it ends. Experian IdentityWorks monitors all three national credit bureaus (Equifax, Experian, and TransUnion) to look for changes in your credit reports, and provides real-time notifications of credit inquires.
“Credit monitoring does provide products and services to help detect identity theft, so it’s definitely worth signing up for when it’s free,” said cyber security expert Adam Levin, host of the What The Hack? podcast. “This does not replace the need for you to remain vigilant and keep an eye on your important accounts.”
Cash Payment: Up to $125 to cover losses or expenses incurred because of identity theft or fraud “that is fairly traceable to the data breach,” including: losses from unauthorized charges to you accounts, fees paid to professionals (such as accountants or attorneys) or other expenses (such as notary fees, postage, document shipping fees, and phone charges) paid to help recover from identity theft. You can also claim compensation of up to $25 per hour for up to 20 hours for your time spent dealing with this.
Claims for settlement benefits are being reviewed, with no firm date for when they will be paid. You will be sent a check or debit card, depending on which option you selected when you filed your claim.
If you did not file a claim but had or have in the future expenses for dealing with problems resulting from the breach between Jan. 23, 2020, and Jan. 22, 2024, you can still file a claim on the settlement website.
Something for Everyone
As part of the settlement, free credit restoration services are available for seven years, if you discover your personal information stolen in the breach was misused, even if you never filed a claim.
If you’re not sure you were affected by the breach, you can check your eligibility with this look-up tool. The confirmation page provides information on how to get this free help.
Everyone with an Equifax credit file can get seven free Equifax credit reports per year through 2026 by going to AnnualCreditReport.com. Right now, all three credit bureaus are voluntarily providing free credit reports once a week through the end of 2022. This is being done to help people with financial problems caused by the pandemic.
Equifax also agreed to change its business practices to increase data security for the next five years.
“Just a reminder: These services are free, but you may get offers for other types of services that come with a fee,” Velazquez said. “You're not required to make a purchase to take advantage of the free services that are part of this settlement.”
- Equifax Data Breach Settlement Homepage
- Equifax Data Breach Settlement FAQ
- FTC Update on Equifax Data Breach Settlement
Contributing editor Herb Weisbaum (“The ConsumerMan”) is an Emmy award-winning broadcaster and one of America's top consumer experts. He is also the consumer reporter for NW Newsradio in Seattle. You can also find him on Facebook, Twitter, and at ConsumerMan.com.