Tag Archives: data breach

AT&T Faces Massive Data Breach Impacting 73 Million and Negligence Lawsuits

Fig 1. AT&T Data Breach Infographic, WLBT3, 2024.

After weeks of denials, AT&T Inc. (NYSE:T), a leading player in the telecommunications sector, has recently unveiled a substantial data breach originating from 2021, leading to the compromise of sensitive information belonging to 73 million users [1]. This data breach has since surfaced on the dark web, exposing a trove of personal data including Social Security numbers, email addresses, phone numbers, and dates of birth, impacting both current and past account holders. The compromised information encompasses names, addresses, phone numbers, and for numerous individuals, highly sensitive data such as Social Security numbers, dates of birth, and AT&T passcodes.

How can you determine if you were impacted by the AT&T data breach? Firstly, ask yourself if you ever were a customer, and do not rely solely on AT&T to notify you. By utilizing services like Have I Been Pwned, you can ascertain if your data has been compromised. Additionally, Google’s Password Checkup tool can notify you if your account details are exposed, especially if you store password information in a Google account. For enhanced security, the premium edition of Bitwarden, a top-rated recommended password manager, offers the capability to scan for compromised passwords across the internet.

One prevalent issue concerning data breaches is the tendency for individuals to overlook safeguarding their data until it’s too late. It’s a common scenario – we often don’t anticipate our personal information falling into the hands of hackers who then sell it to malicious entities online. Regrettably, given the frequency and magnitude of cyber-attacks, the likelihood of your data being exposed has shifted from an “if” to a “when” scenario.

Given this reality, it’s imperative to adopt measures to safeguard your identity and data online, including [2]:

  1. Implementing multi-factor authentication – a crucial step in thwarting hackers’ attempts to infiltrate your accounts, even if your email address is publicly available.
  2. Avoiding password reuse and promptly changing passwords if they are compromised in a data breach – this practice ensures that even if your login credentials are exposed, hackers cannot infiltrate other accounts you utilize, including the one that has experienced a breach.
  3. Investing in identity protection services, either as standalone solutions or as part of comprehensive internet security suites – identity protection software can actively monitor the web for data breaches involving you, enabling you to take proactive measures to safeguard your identity.

AT&T defines a customer’s passcode as a numeric Personal Identification Number (PIN), typically consisting of four digits. Distinguishing it from a password, a passcode is necessary for finalizing an AT&T installation, conducting personal account activities over the phone, or reaching out to technical support, according to AT&T.

How to reset your AT&T passcode:

AT&T has taken steps to reset passcodes for active accounts affected by the data breach. However, as a precautionary measure, AT&T advises users who haven’t altered their passcodes within the last year to do so. Below are the steps to change your AT&T passcode:

  1. Navigate to your myAT&T Profile.
  2. Sign in when prompted. (If additional security measures are in place and sign-in isn’t possible, AT&T suggests opting for “Get a new passcode.”)
  3. Locate “My linked accounts” and select “Edit” for the passcode you wish to update.
  4. Follow the provided prompts to complete the process.

Here is AT&T’s official statement on the matter from 03/03/24 [3]:

“Based on our preliminary analysis, the data set appears to be from 2019 or earlier, impacting approximately 7.6 million current AT&T account holders and approximately 65.4 million former account holders. Currently, AT&T does not have evidence of unauthorized access to its systems resulting in exfiltration of the data set. The company is communicating proactively with those impacted and will be offering credit monitoring at our expense where applicable. We encourage current and former customers with questions to visit http://www.att.com/accountsafety for more information.”

The hackers behind this, allegedly ShiningHacker, endeavored to profit from the pilfered data by listing it for sale on the RaidForums data theft forum, initiating the bidding at $200,000 and entertaining additional offers in increments of $30,000 [4]. Moreover, they demonstrated readiness to promptly sell the data for $1 million, highlighting the gravity and boldness of the cyber offense.

Not surprisingly, AT&T is currently confronting numerous class-action lawsuits subsequent to the company’s acknowledgment of this data breach, which compromised the sensitive information of 73 million existing and former customers [5]. Among the ten lawsuits filed, one is being handled by Morgan & Morgan, representing plaintiff Patricia Dean and individuals in similar circumstances.

The lawsuit levels allegations of negligence, breach of implied contract, and unjust enrichment against AT&T, contending that the company’s deficient security measures and failure to promptly provide adequate notification about the data breach exposed customers to significant risks, including identity theft and various forms of fraud. It seeks compensatory damages, restitution, injunctive relief, enhancements to AT&T’s data security protocols, future audits, credit monitoring services funded by the company, and a trial by jury [6].


About the Author:

Jeremy Swenson is a disruptive-thinking security entrepreneur, futurist/researcher, and senior management tech risk consultant. He is a frequent speaker, published writer, podcaster, and even does some pro bono consulting in these areas. He holds an MBA from St. Mary’s University of MN, an MSST (Master of Science in Security Technologies) degree from the University of Minnesota, and a BA in political science from the University of Wisconsin Eau Claire. He is an alum of the Federal Reserve Secure Payment Task Force, the Crystal, Robbinsdale and New Hope Citizens Police Academy, and the Minneapolis FBI Citizens Academy.

References:

[1] AT&T. “AT&T Addresses Recent Data Set Released on the Dark Web.” 03/30/24: https://about.att.com/story/2024/addressing-data-set-released-on-dark-web.html

[2] Colby, Clifford, Combs, Mary-Elisabeth; “Data From 73 Million AT&T Accounts Stolen: How You Can Protect Yourself.” CNET. 04/02/24: https://www.cnet.com/tech/mobile/data-from-73-million-at-t-accounts-stolen-how-you-can-protect-yourself/

[3] AT&T. “AT&T Addresses Recent Data Set Released on the Dark Web.” 03/30/24: https://about.att.com/story/2024/addressing-data-set-released-on-dark-web.html

[4] Naysmith, Caleb. “73 Million AT&T Users’ Data Leaked As Hacker Said, ‘I Don’t Care If They Don’t Admit. I’m Just Selling’ Auctioned At Starting Price Of $200K”. https://finance.yahoo.com/news/73-million-t-users-data-173015617.html

[5] Kan, Michael. “AT&T Faces Class-Action Lawsuit Over Leak of Data on 73M Customers.” PC Mag. 04/02/24: https://www.pcmag.com/news/att-faces-class-action-lawsuit-over-leak-of-data-on-73m-customers

[6] Kan, Michael. “AT&T Faces Class-Action Lawsuit Over Leak of Data on 73M Customers.” PC Mag. 04/02/24: https://www.pcmag.com/news/att-faces-class-action-lawsuit-over-leak-of-data-on-73m-customers

Two Equifax Leaders Charged with Insider Trading Amid Data Breach Mess

equifax (1).jpgA former software developer for Equifax, Sudhakar Reddy Bonthu, faces insider trading charges related to the company’s massive data breach last year, according to the SEC and federal prosecutors. Allegedly, in August 2017, Bonthu was asked to participate in Project Sparta, which Bonthu’s bosses described as a major project for one of the company’s clients who suffered a major breach that exposed details of over 100 million users.

Unknown to Bonthu at the time, that client was Equifax itself, which a month prior discovered that it was hacked and an intruder stole details for over 145.5 million US and international users. Bonthu was tasked with creating “an online user interface into which users could input information to determine whether they had been impacted by the breach.” According to court documents, he was told that “the project was a high priority for the unnamed company and had a short deadline because the client intended to ‘go live’ on September 6, 2017, with the breach remediation applications designed by Equifax.”

To create the website, which later turned out to be equifaxsecurity2017.com, Bonthu was given test data and was included in mailing lists exchanging information about the still-secret breach. SEC investigators say that Bonthu concluded on his own that the secret client in Project Sparta was in fact Equifax itself.

In an attempt to obstruct his trail he used his wife’s trading account, wherefrom he purchased eighty-six out-of-the-money put option contracts for shares of Equifax common stock with an expiration date of September 15, 2017, and a strike price of $130 per share. Bonthu made this purchase despite the fact that Equifax’s policies expressly prohibit any trading in derivative securities, including put and call options.

By purchasing out-of-the-money put options, Bonthu could make money only if the market price of Equifax stock were to drop below the put option strike price before the contract expired approximately two weeks later, on September 15. If the market price did not so drop, the put options would expire and his investment would be worthless.

On September 8, the price of Equifax common stock closed at $123.23, a drop of $19.49 (nearly 14%) per share from the prior day’s closing price of $142.72. […] As a result of the precipitous drop in Equifax’s share price, Bonthu turned his initial investment of $2,166.11 into $77,333.79 in only six days. In sum, Bonthu’s ill-gotten gains from his trading in Equifax options totaled $75,167.68, a return of more than 3,500% on his initial investment.

3028.03.15equifaxchart.JPG

The SEC says Bonthu had never previously traded in Equifax options. Equifax fired Bonthu in March 2018 after he allegedly refused to cooperate on an internal investigation on charges that he violated the company’s insider trading policy. Bonthu has agreed today to a permanent injunction and to return ill-gotten gains plus interest. If the settlement is approved by a judge, this will terminate SEC civil charges.

The equifaxsecurity2017.com website, on which Bonthu worked, has been deemed one of the most poorly put together breach notification sites in recent years, with several issues affecting it.

He is the second Equifax employee charged with insider trading after Equifax’s breach last year. Earlier this March the SEC charged former CIO of Equifax U.S. Information Solutions Jun Ying. Equifax says it tipped off the Department of Justice and the SEC to Ying’s alleged insider trading.

Although Ying wasn’t directly told that Equifax had been breached, he was assigned to assist Equifax’s Global Consumer Solutions unit with what was billed as “a business opportunity for an unnamed client,” code-named Project Sparta, according to court documents. The project was designated as “urgent,” and everyone participating, including Ying and his team, were instructed to cancel their Friday evening plans and respond to all requests.

At 5:27 p.m. that day, Ying texted a co-worker that the breach they were working on “sounds bad” and noted: “We may be the one breached. . .. Starting to put 2 and 2 together,” according to the SEC complaint. Later that evening, Ying learned that Equifax’s CSO, chief legal officer and vice president of cybersecurity had all canceled their travel plans, it adds.

The following Monday, around 10 a.m., “Ying used a search engine to find information on the internet concerning the September 2015 cybersecurity breach of Experian, another one of the three major credit bureaus, and the impact that breach had on Experian’s stock price,” according to the complaint. “The search terms used by Ying were: (1) ‘Experian breach’; (2) ‘Experian stock price 9/15/2015’; and (3) ‘Experian breach 2015.’

“This defendant took advantage of his position as Equifax’s USIS chief information officer and allegedly sold over $950,000 worth of stock to profit before the company announced a data breach that impacted over 145 million Americans,” says U.S. Attorney Byung J. “BJay” Pak. “Our office takes the abuse of trust inherent in insider trading very seriously and will prosecute those who seek to profit in this manner. By selling when he did, Ying avoided losses in excess of $117,000.”

Earlier this month, Equifax revised its estimate of the breach’s impact to 147.9 million U.S. consumers. About 15 million U.K. consumers – of which about 860,000 are at risk of identity theft – and 8,000 Canadian consumers also saw their personal information get breached (see Equifax Breach Victims: UK Count Goes Up).

I identified Equifax’s control gaps and conflict of interest in a post shortly after the breach in 2017. I suspected then as I do now that more people will be charged related to conflict of interest with LifeLock identity theft protection.

Information sourced from Tara Siegel Bernard for the New York Times, Allison Prang for the Wall Street Journal, and the associated press. Curated and edited by Jeremy Swenson of Abstract Forward Consulting.