U.S. se­na­tors urge stock sales probe

Three Equifax ex­ec­u­tives sold shares worth $1.8M af­ter hack


WASH­ING­TON— More than a third of U.S. se­na­tors want the Se­cu­ri­ties and Ex­change Com­mis­sion and the De­part­ment of Jus­tice to get to the bot­tom of whether Equifax Inc. man­agers vi­o­lated in­sider trad­ing laws when they sold stock days af­ter the com­pany found out it was hacked.

Thirty-six law­mak­ers, con­sist­ing of mostly Democrats and some Repub­li­cans, signed let­ters sent to the agen­cies and the Fed­eral Trade Com­mis­sion (FTC) Tues­day. The bi­par­ti­san-re­quest shows the de­gree of pub­lic out­rage over a breach that may have led to the theft of 143 mil­lion Amer­i­cans’ per­sonal data — and how it is re­ver­ber­at­ing in Wash­ing­ton.

The stock sales in ques­tion in­volve Equifax chief fi­nan­cial of­fi­cer John Gam­ble, pres­i­dent of U.S. in­for­ma­tion so­lu­tions Joseph Loughran and pres­i­dent of work­force so­lu­tions Rodolfo Ploder. The ex­ec­u­tives un­loaded shares worth al­most $1.8 mil­lion (U.S.) days af­ter the com­pany dis­cov­ered a se­cu­rity breach on July 29. Equifax pub­licly dis­closed the hack six weeks later, and has re­peat­edly said the man­agers didn’t know of the breach at the time they sold shares.

“We re­quest that you con­duct a thor­ough ex­am­i­na­tion of any un­usual trad­ing, in­clud­ing any atyp­i­cal op­tions trad­ing, for vi­o­la­tions of in­sider trad­ing law,” the se­na­tors, led by Rhode Is­land Demo­crat Jack Reed and Louisiana Repub­li­can John Kennedy, wrote in the let­ter.

SEC chair­man Jay Clay­ton de­clined to com­ment on Equifax and whether the agency was look­ing into the ex­ec­u­tives’ trades.

Clay­ton said the SEC is work­ing to in­crease pub­lic aware­ness of the “sub­stan­tial sys­temic risks” as­so­ci­ated with cy­ber­se­cu­rity.

FTC act­ing chair Mau­reen Ohlhausen told jour­nal­ists Tues­day that her agency is look­ing closely at the Equi- fax mat­ter, though she stopped short of say­ing it has opened a for­mal in­ves­ti­ga­tion. The Jus­tice De­part­ment didn’t re­spond to an email seek­ing com­ment.

At least six con­gres­sional com­mit­tees are ex­am­in­ing the in­ci­dent, scru­ti­niz­ing how the breach hap­pened and why Equifax waited more than a month to dis­close it. Law­mak­ers are also us­ing the hack to push pol­icy goals, such as call­ing for stiffer re­quire­ments on how com­pa­nies han­dle con­sumer data and the re­moval of bar­ri­ers con­sumers face in su­ing fi­nan­cial com­pa­nies.

Reg­u­la­tors are also look­ing closely at Equifax, which is among a hand­ful of com­pa­nies that con­trol data such as credit his­to­ries that banks rely on to is­sue loans.

The Con­sumer Fi­nan­cial Pro­tec­tion Bu­reau, which has the au­thor­ity to mon­i­tor credit-re­port­ing com­pa­nies and go af­ter firms that fail to pro­tect con­sumers, said it is look­ing into the breach and how the com­pany has re­sponded.


Thirty-six law­mak­ers signed let­ters sent to agen­cies and the Fed­eral Trade Com­mis­sion Tues­day re­gard­ing Equifax.

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