Equifax Is `Exhibit A' in Case for Regulation, Durbin Says
(Bloomberg) -- The massive data breach at Equifax Inc. is "exhibit A" on the need for strong U.S. regulation, including higher fines against companies that mishandle consumers’ personal information, second-ranking Senate Democrat Dick Durbin said Monday.
"We are duty-bound to step in on behalf of innocent citizens who are going to pay a price," Durbin said in an interview with Bloomberg News.
Equifax last week disclosed a computer breach that may have affected 143 million people -- or almost half the U.S. population -- revealing Social Security numbers, drivers’ license data and birth dates. The Atlanta-based company now faces multiple state and federal investigations, and a proposed multibillion-dollar class action lawsuit was filed against Equifax.
While Durbin said Republicans are loath to regulate, he called the hack "an indictment of our current level of regulation when it comes to this industry and others."
Asked if the Equifax hack indicated more related regulation is needed, White House press secretary Sarah Huckabee Sanders said the matter “is something we have to look into extensively.” President Donald Trump’s homeland security adviser Tom Bossert will lead the administration’s efforts to respond to the Equifax data hack, Sanders said.
The Federal Bureau of Investigation and the Consumer Financial Protection Bureau are looking into the data breach, which Equifax said it discovered on July 29, and at least three U.S. House committees said they would hold hearings.
Equifax’s data is used by lenders to assess whether consumers should be granted loans. The company can expect weeks, if not months, of scrutiny over whether it could have done more to protect the data, and why it waited so long to inform consumers of the breach.
The Federal Trade Commission’s ability to penalize companies that don’t take strong steps to protect consumers should be re-examined after Equifax’s breach, Durbin said. Current fines “could hardly have envisioned a breach that would reach nearly half the population of the country,” he said.
Senate Finance Chairman Orrin Hatch, a Utah Republican, and the panel’s top Democrat, Ron Wyden of Oregon, sent a letter to Equifax Chief Executive Officer Richard Smith asking the company to respond to numerous questions about the breach. Among them, the company was asked when the breach was reported to three top executives who sold hundreds of thousands of dollars in Equifax stock at the beginning of August.
Senator Richard Blumenthal, a Connecticut Democrat, said in a separate letter to Smith that the company’s remedies for the breach were "pathetic" and that offering one year of free credit monitoring to consumers provided "scant protection" to those who were harmed. Equifax should offer free credit monitoring indefinitely and should drop its charges of up to $10 to consumers who want to freeze their credit, he said.
Democratic Senator Brian Schatz of Hawaii said he was reintroducing legislation that would make it easier for consumers to deal with identity theft and mistakes in their credit reports.
Durbin also said Congress has a "compelling opportunity" to pass legislation by the end of the year protecting immigrants brought to the U.S. as children from deportation, following Trump’s decision last week to end an Obama-era order allowing them to stay in the U.S.
The senator said Democrats would consider accepting a boost in federal funding for border security in exchange for restoring the young immigrants’ legal status. At the same time, he said they would refuse to back Trump’s proposed wall at the U.S.-Mexico border or any crackdown on so-called sanctuary cities that limit their cooperation with federal immigration officials.
"The wall is a non-starter,” Durbin said. “Deporting the parents of Dreamers is a non-starter. We think sanctuary cities is a non-starter. Beyond that, we’re prepared to sit down and hear proposals" on border security, he said.
Durbin has co-sponsored legislation with Republican Senator Lindsey Graham of South Carolina that would grant legal permanent resident status and a pathway to citizenship to about 800,000 undocumented immigrants brought to the U.S. as children, known as dreamers.
Trump this month announced an end to the program in the next six months and called on Congress to take action by then to protect them.
Durbin didn’t rule out the possibility that Democrats may seek to tie their support for the next debt-limit increase to a Dream Act plan.
"We hope we don’t have to get to a face-down with the White House or Republicans over this issue," Durbin said. "But Senator Schumer and Nancy Pelosi have made it abundantly clear that this is a priority. We’re not going to leave town without it.” Senate Democratic leader Chuck Schumer of New York and his House counterpart, Pelosi of California, have both demanded protection for the young immigrants.