Former Equifax Chief Executive Richard Smith testified before the Senate Committee on Banking, Housing, and Urban Affairs on Wednesday amid accusations that the credit bureau is profiting off the breach, which is bound to increase auto fraud.
Auto loan fraud has hit record highs in recent years and Equifax has viewed that as an opportunity to grow its company, Senator Elizabeth Warren (D-MA) said during the committee. Warren noted that on a previous earnings call, Smith had said: “Fraud is a huge opportunity for us, it is a huge growing business for us,” Warren noted.
Now that 143 million Social Security numbers have been exposed the industry can expect even more fraud, AFN previously reported. Equifax sells consumers and businesses fraud protection services that the company could eventually profit off of.
Since the hack, more than 7.5 million people have signed up for a free year of Equifax’s fraud protection service, but those consumers will be charged for the service once the trial expires. Furthermore, Equifax has a revenue-sharing partnership with LifeLock’s theft protection service, which has seen an increase in business since the hack.
Smith did note five services that the company is providing free of charge to help consumers protect their credit profile including credit bureau monitoring from all major services, the ability for consumers to lock their credit file, a scan of the dark web on behalf of the consumer, access to Equifax’s file on the consumer, and an insurance product.
Moving forward, many cybersecurity experts believe a new standard will have to replace Social Security numbers, Smith said during the hearing.
“I worry [because] Social Security numbers have been out there since 1936, used to be on drivers licenses, and are used in employment,” he said. “You talk with cybersecurity experts and they say the vast majority of all SSNs have been compromised. … I would encourage a dialogue on what is a better way to identify individuals beyond SSNs.”
While Smith wasn’t able to provide any alternatives, Frank McKenna, chief fraud strategist at PointPredictive, told AFN the industry may look toward digital identity solutions that various startups are developing now.
Even Republican congressmen went after the credit bureau for providing a service in which consumers are not compensated for information they have no control over. “I don’t pay extra in a restaurant to keep the waiter from spitting in my food,” John Kennedy (R-LA) said.
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