Equifax boss ousted following major cybersecurity breach

Credit reporting agency Equifax has ousted chief executive Richard Smith following a damaging data breach that exposed highly sensitive information about 143 million Americans.

The shake-up announced on Tuesday comes after Equifax disclosed that hackers exploited a software flaw that the company did not fix to take social security numbers, dates of birth and other personal data that provide the keys to identify theft.

Mr Smith will also step down as chairman. He had been Equifax’s chief executive 2005.

Paulino do Rego Barros Jr was named interim chief executive, while board member Mark Feidler was appointed non-executive chairman. Equifax said it will conduct a search for a permanent chief executive.

While the company said Mr Smith was retiring, Equifax said in a regulatory filing that it has not entered into any other arrangement or agreement with Mr Smith in connection with his retirement. He will however, serve as an unpaid adviser to help with the transition process.

The company said Mr Smith will not receive his annual bonus, and his other potential retirement-related benefits will not be awarded until Equifax concludes an independent review of the data breach.

“The cybersecurity incident has affected millions of consumers, and I have been completely dedicated to making this right,” Mr Smith said in a statement.

“At this critical juncture, I believe it is in the best interests of the company to have new leadership to move the company forward.”

Although many analysts had applauded Equifax’s performance under Mr Smith, he and the rest of his management team had come under fire for lax security and its response to the breach.

Mr Smith’s departure follows the abrupt retirement of Equifax’s chief security officer and chief information officer.

Equifax had tried to appease incensed politicians, consumers and investors on September 15 with the unceremonious retirement of its chief security officer and chief information officer who were responsible for managing and protecting the company’s technology.

But that was not enough, with politicians drawing up bills that would impose sweeping reforms on Equifax and its two main rivals, Experian and TransUnion, and Equifax’s stock in a downfall that wiped out one third-of the Atlanta company’s value, a 5.5 billion US dollar setback.

Mr Smith had been scheduled to appear on October 3 during a congressional hearing that would likely have turned into a public lambasting. It was not immediately clear whom Equifax will send in Mr Smith’s place to face politicians’ wrath.

The jobs of other Equifax executives could still be in jeopardy.

Three of them, including Equifax’s chief financial officer, are under scrutiny for selling some of their company shares for a combined 1.8 million US dollars before the breach disclosure hammered Equifax’s stock.

Mr Smith’s departure also will not make life any easier for most of the US adult population who had their information accessed through no fault of their own, but now have to worry about imposters assuming their identities to obtain credit cards and apply for loans so they can run up huge bills.