National Public Data files for bankruptcy after massive data breach put "hundreds of millions" at risk

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Company says it simply doesn't have the money to repair the damage

Data Breach
Image Credit: Shutterstock (Image credit: Shutterstock)

National Public Data, a background check service that collects and stores large amounts of personal data, has filed for bankruptcy after failing to recover from suffering a devastating cyberattack.

In December 2023, the company announced experiencing a cyberattack but said at the time that 1.3 million people were affected, with crooks said to have stolen people’s names, email addresses, phone numbers, Social Security Numbers, and postal addresses.

Half a year later, a threat actor known as USDoD started offering a database for sale, allegedly stolen from National Public Data. This database, according to the crooks, contained sensitive information on roughly 2.9 billion people, and led to the company facing numerous class-action lawsuits, as well as watchdog and regulator probes.

No assets

That, together with the fact that it would have to cover the expenses of identity theft and credit monitoring services for everyone, forced the company to file for bankruptcy.

"The debtor is likely liable through the application of various state laws to notify and pay for credit monitoring for hundreds of millions of potentially impacted individuals," it was said in the bankruptcy petition, filed by Jerico Pictures (National Public Data owner entity). “As the debtor’s schedules indicate, the enterprise cannot generate sufficient revenue to address the extensive potential liabilities, not to mention defend the lawsuits and support the investigations. The debtor’s insurance has declined coverage."

Bankruptcy won’t help the victims much, either, since the company barely has any assets. An accounting document submitted with the bankruptcy filing, it was said that the company was owned and operated by a single individual - Salvatore Verini Jr, and owned two HP Pavilion desktop computers ($400), a ThinkPad laptop ($100), and five Dell servers ($2000). Furthermore, it has some $33,000 in a corporate checking account in New York. Its total assets are roughly between $25,000 and $75,000.

Although, it made more than a million dollars last year.

Via The Register

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Sead Fadilpašić

Sead is a seasoned freelance journalist based in Sarajevo, Bosnia and Herzegovina. He writes about IT (cloud, IoT, 5G, VPN) and cybersecurity (ransomware, data breaches, laws and regulations). In his career, spanning more than a decade, he’s written for numerous media outlets, including Al Jazeera Balkans. He’s also held several modules on content writing for Represent Communications.