Choicepoint to Pay $15M Fine
Atlanta-based data aggregator ChoicePoint today agreed to pay $15 million to settle charges that it violated federal consumer protection laws when it allowed criminals to purchase sensitive financial and personal data on at least 163,000 Americans.
The settlement addresses a pair of lawsuits filed against ChoicePoint by the Federal Trade Commission and represents the largest civil penalty ever obtained by the agency.
Via Brian Krebs at the Security Fix blog.
Adam,
On Jan 22nd on the BofA post, I commented:
” . . . the ability to identify and address these issues will require that more firms fail through their share prices as opposed to pressures from the security community and regulatory agencies . . .”
CPS closing price:
01/26/2006 $42.95
01/25/2006 $46.30
(source: http://finance.yahoo.com/q?s=cps)
I don’t have VWAP for these sessions, but given an estimate from the previous trading session, this represents a one-day loss of $3.30 (volume weighted estimate) per share in price. On shares outstanding on CPS of 89.68M, this represents a total loss (to all shareholders) of slightly more than US$295M. This, for a settlement with damages in the amount of US$15M.
Conclusion – A management team that did not give reasonable attention to the security issues at hand now has good reason to do so (is the Federal Trade Commission a regulatory agency?).
Apparently the tail wags the dog. I stand corrected.
Regards,
—O
p.s. Of course, CPS, at US$3.85B (in market cap) could still go belly up, so there is an opportunity for me to retract this . . .