Identity theft is common in the U.S., reason why most citizens hire ID theft-protection companies to keep their data safe.
LifeLock is one of those firms hired by customers to look out after their identities after their personal information was hijacked in a breach. But, to their shock, LifeLock was unable to secure their data properly.
The Federal Trade Commission took to court and filed a complaint towards LifeLock for failure to conform with a 2010 order and agreement that required the company to organize and maintain a thorough security program to safeguard sensitive personal information clients entrusted to the firm as detailed in its identity-theft protection duty.
LifeLock was supposed to monitor the credit accounts of those previously victimized by ID theft in order to protect them and prevent another breach. In doing so, LifeLock required a large amount of sensitive information such as names and addresses, Social Security numbers, birth dates and bank card information.
FTC discovered in 2010 that LifeLock failed to administer "reasonable and appropriate security to prevent unauthorized access to personal information stored on its corporate network," either in connection through its network, communicated over the internet or stored in a database, as per Wired.
Director of the FTC's Bureau of Consumer Protection Jessica Rich said, "It is essential that companies live up to their obligations under orders obtained by the FTC. If a company continues with practices that violate orders and harm consumers, we will act," as per Twitchy.
Jon Leibowitz, FTC Chairman commented in 2010: "In truth, the protection they provided left such a large hole ... that you could drive that truck through it," in reference to a LifeLock TV advertisement which depicted a truck with CEO Todd Davis' Social Security number passing around the streets.
The antitrust watchdog requested the U.S District Court for the District of Arizona to enforce an order that beseech LifeLock to grant full redress to all clients affected by the firm's "order violations."
According to Reuters, LifeLock conceded to pay $12 million in 2010 as settlement for the claims made by the FTC and the U.S. states that it exaggerated the value of its business.
Meanwhile, LifeLock released a statement on Tuesday that said, "We disagree with the substance of the FTC's contentions and are prepared to take our case to court."
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