IRS whacks $7M Equifax deal

WASHINGTON — The IRS suspended a $7.25 million contract with the credit reporting company Equifax Friday after members of Congress complained the tax agency awarded a no-bid contract to a company that recently had a massive data breach. The IRS had a contract with Equifax to validate the identity of taxpayers communicating with the agency on the telephone or through its website.

In a statement Friday, the IRS said it suspended the deal as “a precautionary step” while the agency reviews the company’s security systems.

“During this suspension, the IRS will continue its review of Equifax systems and security,” the statement reads. “There is still no indication of any compromise of the limited IRS data shared under the contract.”

Equifax revealed in September that hackers obtained the personal information of more than 145 million people. Cyber criminals stole Social Security numbers, birth dates and addresses, and in some cases driver’s license numbers. Equifax CEO Richard Smith stepped down. He later went before Congress for a public shaming in which he apologized.

Equifax issued a statement Friday that said, “We are engaging IRS officials to review the facts and clarify available options.”