National Public Data has filed for bankruptcy protection following a massive data breach that allegedly exposed many people’s sensitive information.
At a Glance
- National Public Data, owned by Jerico Pictures, filed for Chapter 11 bankruptcy following a massive data breach.
- The breach was previously alleged to have exposed personal info of up to 2.9 billion people, although many reports have put the number in the hundreds of millions.
- Numerous lawsuits and investigations followed the breach.
Bankruptcy Filing After a Data Breach
National Public Data, owned by Jerico Pictures, filed for Chapter 11 bankruptcy protection in Florida on Oct. 2. This follows a catastrophic data breach that was previously alleged to have compromised the personal information of an estimated 2.7 billion to 2.9 billion individuals, releasing names, Social Security numbers, and addresses into the public domain. Security researchers, however, have indicated the stolen database likely contained hundreds of millions of unique Social Security numbers in it rather than billions.
Law enforcement and regulatory bodies, including the Federal Trade Commission and more than 20 states, are investigating the breach. The company says it faces numerous class-action lawsuits as it navigates through its financial and legal challenges. Meanwhile, state regulators beyond Missouri are investigating, further emphasizing the gravity of the breach’s implications on privacy laws.
Financial and Operational Strain
The data breach put immense financial pressure on Jerico Pictures, necessitating loans for the cost of identity theft protection and credit monitoring services for those affected by the breach. The company, which operates without dedicated physical office space, relies on the owner’s home office for its operations.
“The reputational impact has driven customers from the Debtor. The Debtor is likely liable through the application of various state laws to notify and pay for credit monitoring for hundreds of millions of potentially impacted individuals,” the company said.
Jerico Pictures’ financial situation worsens without insurance coverage for the breach, further straining resources. The company’s insurance declined the breach coverage, citing liabilities, thus complicating its difficult position.
Implications and Ongoing Investigations
A shortage of assets and an estimated gross revenue of $1.15 million in 2023 create additional stress. Bankruptcy documents reveal liabilities from the breach reaching significant levels, equating to nearly all of the company’s assets.
The breach typifies the inherent vulnerabilities of the data brokering industry amid increasing cyber threats.
Sources
- National Public Data files for bankruptcy, citing fallout from cyberattack
- National Public Data, the hacked data broker that lost millions of Social Security numbers and more, files for bankruptcy
- National Public Data files for bankruptcy, admits ‘hundreds of millions’ potentially affected
- National Public Data files for bankruptcy after massive data breach put “hundreds of millions” at risk
