Equifax CEO booted out following massive cyber breach

Equifax CEO booted out following massive cyber breach

Equifax being investigated by the U.S. Federal Trade Commission, and faces a barrage of questions from Congress

Credit: Equifax

Equifax said on Tuesday its CEO Richard Smith will step down and forgo his annual bonus, a move that came weeks into a mounting crisis at the credit-monitoring firm stemming from a massive data breach.

Equifax is being investigated by the U.S. Federal Trade Commission, and faces a barrage of questions from Congress and public ire over what has widely been viewed as a bungled response to a hack that exposed the personal details of up to 143 million U.S. consumers.

The credit-monitoring firm disclosed on 7 September that hackers had access to its systems between mid-May and July.

The announcement that Smith, 57, would depart came ten days after the company said its chief information officer and chief security officer were retiring.

Shares of Equifax were down 1.6 percent at $103.35 early on Tuesday.

"At this critical juncture, I believe it is in the best interests of the company to have new leadership to move the company forward," Smith said in a statement.

Paulino do Rego Barros, 61, who was most recently president of Equifax's Asia-Pacific operations, will be interim CEO.

The announcement comes a week before Smith was expected to testify before multiple congressional committees about the cyber attack.

A spokeswoman for the U.S. House Energy and Commerce Committee said Smith, whose retirement was effective on Tuesday, would still testify before the panel on 3 October. The Senate Banking Committee did not immediately respond when asked if Smith would appear as scheduled on 4 October.

"Rick Smith is scheduled to testify before Congress. It's up to the committee to decide if they want another executive," an Equifax spokeswoman said in an emailed statement. "We will fully cooperate with Congress, as we have since this cybersecurity incident was first disclosed."

The company and Smith agreed that Equifax will defer any decision related to "any obligations or benefits" owed to him until the company's board completes an independent review of the breach, according to a regulatory filing. Smith earned a total of US$14.96 million in 2016.

Equifax shares have fallen more than 30 per cent since the disclosure of the breach amid mounting criticism from lawmakers, regulators and consumers about the hack and the company’s response to it.

In 2014, Target CEO Greg Steinhafel left the retailer after it was revealed hackers had accessed credit card and personal information belonging to tens of millions of shoppers.

(Reporting by John McCrank in New York; Dustin Volz in Washinton and Supantha Mukherjee in Bengaluru; Editing by Sai Sachin Ravikumar and Meredith Mazzilli)

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