Cyber attack forces Moody’s to downgrade Equifax

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Equifax data breach of 2017 has made Moody’s downgrade the company’s outlook from stable to negative. The American business and financial services company say that downgrade was essential due to cybersecurity issues.

Moody’s’ Corporation has released a press statement saying that the credit monitoring company had to experience a downgrade due to a massive breach of its consumer database in 2017.

What’s surprising is this whole issue is that for the first time the company has issued its rating change due to a data breach.

As investors look into ratings for pouring in funds, Moody’s had no choice other than to downgrade the Outlook of Equifax. The decision could also influence insurance companies to adequately predict fallout in the near future.

Moody’s estimates that the cybersecurity expenses and capital investments of Equifax will total to $400 million in 2019 and 2020 and might downfall to $250 million in 2021.

Equifax was not immediately available for comment.

Note 1- Moody’s has announced on a recent note that its credit ratings from now will be also be influenced by cyber risks and the way a company is practicing its cybersecurity posture.

Note 2- A report published by CNBC last year says that the data which has been siphoned from Equifax was never used on the dark web. So, the intelligence officials say that the data might have been collected by some foreign state intelligence services for analysis purposes.

Note 3- Data related to social security numbers, driving licenses, and over 200,000 credit card numbers might have reached the hands of hackers by now.