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US Charges Former Equifax Manager With Insider Trading

US Charges Former Equifax Manager With Insider Trading
(Alexey Novikov/Dreamstime)

Thursday, 28 June 2018 11:51 AM

A former Equifax Inc. software development manager was charged on Thursday with insider trading before the credit reporting company disclosed a cyber attack that exposed the personal data of about 148 million people last year.

Federal prosecutors in Atlanta announced the insider trading charges against Sudhakar Reddy Bonthu, who was among the employees given the task of assisting in the company's response to the breach.

It is the second time prosecutors have charged an Equifax employee with profiting by trading on confidential information related to the cyber attack before the company disclosed the data breach last September.

Bonthu is scheduled to be arraigned in federal court in Atlanta later Thursday, prosecutors said. His lawyer and Equifax did not immediately respond to a request for comment.

From May 2017 to July 2017, hackers gained access to Equifax databases, allowing them to acquire the names, Social Security numbers, birthrates and addresses for millions of people, according to the government.

Equifax began investigating the breach in July 2017 after discovering the suspicious activity, and by August had determined that consumers' data had likely been stolen, prosecutors alleged.

Bonthu knew by Aug. 30, 2017 that information from about 100 million individuals had been exposed and that the company planned to publicly disclose the breach in early September, the government said.

Using the information, Bonthu bought put options in Equifax stock using his wife's brokerage account prior to the announcement, allowing him to profit if the company's stock price dropped, according to prosecutors.

Equifax disclosed the breach on Sept. 7, 2017, after the market closed. Its stock price dropped the next day, and Bonthu made more than $75,000 in profit, according to prosecutors.

© 2019 Thomson/Reuters. All rights reserved.

   
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A former Equifax Inc. software development manager was charged on Thursday with insider trading before the credit reporting company disclosed a cyber attack that exposed the personal data of about 148 million people last year.
former, equifax, manager, charged, insider, trading
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2018-51-28
Thursday, 28 June 2018 11:51 AM
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