A Florida-based company, National Public Data, recently filed for Chapter 11 bankruptcy after a major data breach exposed the Social Security numbers and other sensitive information of millions of Americans.
The incident has led to severe legal and financial challenges for both National Public Data and its parent company, Jerico Pictures.
What Happened in the Data Breach?
In December, hackers accessed National Public Data’s systems, stealing sensitive personal data, including:
- 272 million Social Security numbers
- 600 million phone numbers
The stolen information was later found on a hacking forum, making millions of people vulnerable to identity theft. This breach has drawn attention from state attorneys general, the U.S. Federal Trade Commission (FTC), and numerous lawsuits.
Why Did the Company File for Bankruptcy?
National Public Data faced mounting lawsuits and investigations related to the breach. The company admitted in court filings that it could not generate enough money to cover potential damages, legal fees, and fines.
The financial details include:
- A net profit of $865,000 on $1.2 million in sales last year.
- Projected costs from lawsuits far exceeding its resources.
The filing under Chapter 11 allows the company to reorganize while managing its legal issues.
Impact on People Affected by the Breach
The breach has affected millions of Americans who trusted National Public Data to securely store their personal information.
- The company may be required to notify those impacted and offer credit monitoring services.
- Legal actions by more than 20 state attorneys general and federal agencies are ongoing.
Current Challenges for National Public Data
The company’s reputation is severely damaged, with clients leaving and revenue shrinking. It has updated its website, stating it will no longer sell personal data, but the damage is done.
Jerico Pictures, the parent company, also faces significant legal and financial troubles, which further complicates recovery efforts.
What Happens Next?
While the first class-action lawsuit has been paused temporarily, the company must prepare for multiple legal battles. It remains unclear how National Public Data will recover from the massive breach and its consequences.
1. What caused National Public Data to file for bankruptcy?
The company faced overwhelming lawsuits, fines, and investigations following a data breach that exposed sensitive personal information.
2. How many people were affected by the breach?
Millions of Americans were affected, with 272 million Social Security numbers and 600 million phone numbers stolen.
3. What steps is National Public Data taking for affected individuals?
The company may need to offer credit monitoring services and notify those impacted by the breach.
4. Will the company still sell personal data?
No, National Public Data has stated on its website that it will no longer sell personal information.
5. What is Chapter 11 bankruptcy?
Chapter 11 allows a company to reorganize its finances under court supervision while addressing its debts and legal challenges.
