(Reuters) – An special committee of Equifax Inc’s board is investigating the role the credit reporting company’s chief legal officer played in approving share sales by four executives days after suspicious activity was discovered in its systems, according to The Wall Street Journal.
Three of the four executives sold a total of $1.8 million of Equifax stock in early August, days after the company discovered what ended up being one of the largest data breaches in U.S. history, compromising the sensitive financial information of 145.5 million people.
When Equifax later disclosed the breach to the public, the company’s shares plunged as much as 37 percent, erasing billions of dollars from its market value.
The special committee, made up of independent directors, on Friday said it concluded that the executives did not know of the suspicious cyber activity at the time they sold the shares and that no insider trading occurred.
Now the committee is looking into the level of knowledge John Kelley, Equifax’s chief legal officer, who was also in charge of security at the firm, had of the hack at the time he approved the stock sales, the Journal said, citing sources familiar with the matter. (http://on.wsj.com/2zhkzSp)
Kelley is no longer in charge of security, the Journal said.
Equifax did not immediately respond to email and voicemail requests for comment. An Equifax employee reached by phone at the company’s main line declined to forward the call to Kelley.
The U.S. Justice Department is conducting its own criminal investigation into the share sales.
The hack, and Equifax’s response to it, has also prompted investigations by multiple federal and state agencies as well as scores of class action lawsuits.
Credit monitoring services such as Equifax collect vast amounts of financial information from consumers, working with banks and other lenders, for example, to track the creditworthiness of individuals.
(Reporting by John McCrank in New York; Editing by Susan Thomas)