Florida-based data broker National Public Data has filed for bankruptcy protection under Chapter 11 of the United States Bankruptcy Code. A background check company is facing litigation after millions of Social Security numbers and other personal information were stolen in a data breach.
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Open source in governance: left behind rather than dependent?National Public Data filed for bankruptcy (Case 24-20281) in the United States Bankruptcy Court for the Southern District of Florida in Fort Lauderdale in late September because its parent company, Jericho Pictures, faced heavy claims for damages. Fell. First Computer magazine PC Magazine reported About the case last week. Jericho Pictures estimates it will have to notify “millions of potentially affected individuals” and pay for credit monitoring.
millions of records leaked
In December last year, cyber criminals managed to break into the National Public Data System. The first data leak surfaced in April 2024, when threat actor “USDoD” offered the stolen data for sale for $3.5 million. This information may include, but is not limited to, names, email addresses, telephone numbers, social security numbers, and mailing addresses. According to security researchers’ estimates, 272 million Social Security numbers and 600 million telephone numbers of American citizens were stolen in the data breach.
The US competition authority the Federal Trade Commission (FTC) is looking into the matter and more than 20 states are threatening the national public data with civil penalties for data security violations. Additionally, several class action lawsuits have already been filed against Jericho Pictures. The company is accused of not adequately protecting the personal data of millions of people.
filing for bankruptcy against the flood of lawsuits
Typically, companies file for Chapter 11 bankruptcy to achieve a court-supervised reorganization of the company’s finances. But court documents indicate that Jericho Pictures does not have the resources to pay the legal fees and potential penalties. The company “could not generate enough revenue to pay off extensive potential liabilities, let alone defend against lawsuits and support investigations,” it says thereTherefore the debtor’s insurance company has declined the insurance cover. According to court filings, Jericho Pictures has a net worth of between $25,000 and $75,000. In his income declaration The company reported a net profit of $475,526 in 2022 and $865,149 in 2023.
The bankruptcy filing seems to be aimed at helping the company deal with the flood of lawsuits, writes PC Magazine. The magazine reports that as a result of the bankruptcy filing, the first class action lawsuit filed against Jericho Pictures has been temporarily halted by a Florida court.
(AKN)
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