WASHINGTON — Sen. Elizabeth Warren, D-Mass., called for bipartisan action against Equifax during a Senate floor speech on Tuesday, criticizing the credit bureau for waiting several weeks after a massive data breach to reveal it to the public.
“Bad enough that Equifax was so sloppy that they let hackers into their system, but the company's response has been even worse,” Warren said. “Equifax gave criminals a 40-day head start to use the information they had stolen while the rest of us were left in the dark."
Equifax disclosed the leak on Sept. 7, roughly six weeks after it occurred in July.
Warren and Sen. Brian Schatz, D-Hawaii, introduced legislation last week that would give consumers more control over how the three major credit bureaus use consumer information, including giving them the power to put a free freeze on their credit files.
Equifax, TransUnion and Experian usually charge a fee for placing a freeze on a consumer credit file, which prevents other financial companies from using that information to open a line of credit and also stops the companies from selling that information. Warren compared the freeze to a do-not-call list for credit information.
“Equifax doesn’t pay you when they sell your data and you shouldn’t have to pay Equifax to keep them from selling it,” said Warren, who added that her bill is “only the first step” she will take to rein in the credit bureaus.
“It is time for all of us to fight back … Democrats, Republicans, Independents,” Warren said. “We have all been victims of Equifax hack or we know someone who has.”
Warren also bashed the company’s efforts to provide remediation to customers, including offering a year of free credit monitoring. The initial terms of the service required customers to provide more personal information to Equifax, gave ambiguous information about whether a person’s information was actually compromised and sought to make money off the service by including an automatic-enrollment plan after the first year.
“Equifax was trying to impose secret fees” to profit “off the back of their own system,” Warren said.
Equifax’s use of an arbitration agreement, which was included as part of the credit monitoring service, has also drawn criticism. Democrats have pointed to the use of the agreement as an example of why a Consumer Financial Protection Bureau rule banning mandatory arbitration clauses should stand. Arbitration agreements are often used to prevent class-action lawsuits and hidden in the fine print of contracts. The CFPB rule would outlaw the use of them by financial companies.
“Equifax forced consumers to give their right to go to court and sue Equifax if they had any disputes about the terms” of the credit monitoring service, Warren said.
House Republicans passed a resolution to overturn the CFPB's arbitration rule in July and Senate Republicans are trying to pass a similar measure, but it’s unclear if they have enough votes.
Equifax changed its policy after it was criticized for using an arbitration agreement for the credit monitoring service.