This story has been updated with comments from the CFPB and the New York Attorney General’s office.
Worried you may be affected by Equifax’s massive data breach? The credit bureau has set up a site, equifaxsecurity2017.com, that allows you to check whether your personal information was exposed. But regulators are becoming concerned that the site could pose risks to consumers. As a result, you may want to think twice about using it. Here’s why.
The website’s terms of service potentially restricts your legal rights.
Sharp-eyed social media users have combed through the data breach site’s fine print — and have found what they argue is a red flag. Buried in the terms of service is language that bars those who enroll in the Equifax checker program from participating in any class-action lawsuits that may arise from the incident. Here’s the relevant passage of the terms of service:
AGREEMENT TO RESOLVE ALL DISPUTES BY BINDING INDIVIDUAL ARBITRATION. PLEASE READ THIS ENTIRE SECTION CAREFULLY BECAUSE IT AFFECTS YOUR LEGAL RIGHTS BY REQUIRING ARBITRATION OF DISPUTES (EXCEPT AS SET FORTH BELOW) AND A WAIVER OF THE ABILITY TO BRING OR PARTICIPATE IN A CLASS ACTION, CLASS ARBITRATION, OR OTHER REPRESENTATIVE ACTION. ARBITRATION PROVIDES A QUICK AND COST EFFECTIVE MECHANISM FOR RESOLVING DISPUTES, BUT YOU SHOULD BE AWARE THAT IT ALSO LIMITS YOUR RIGHTS TO DISCOVERY AND APPEAL.
This language is commonly known in the industry as an “arbitration clause.” In theory, arbitration clauses are meant to streamline the amount of work that’s dumped onto the court system. But the Consumer Financial Protection Bureau concluded in the summer that arbitration clauses do more harm to consumers than good — and the agency put in place a rule to ban them.
“In practice, companies use these clauses to bar groups of consumers from joining together to seek justice by vindicating their legal right,” Richard Cordray, the CFPB’s director, told reporters in July, according to my colleague Jonnelle Marte.
For consumers affected by Equifax’s breach, this is a live issue; there is already at least one class-action suit brewing against Equifax. Critics say that arbitration is problematic because it limits consumers’ ability to find facts to support their case, a process otherwise known as discovery, to appeal decisions or to present their case before a jury.
If the government is moving to bar arbitration clauses, then why is one in there?
Despite the CFPB’s move to ban arbitration clauses, the rule has not yet gone into effect, according to the agency. That won’t happen until Sept. 18, the CFPB said. What’s more, the rule doesn’t work retroactively, meaning that the Equifax legalese would not be covered anyway. The ban only affects contracts made after March 19, 2018, six months after the rule takes effect.
The CFPB said Friday that Equifax’s arbitration clause was “troubling” and that the agency is investigating the data breach and Equifax’s response.
“Equifax could remove this clause so that consumers can receive this service without condition,” the CFPB said in a statement.
The future of the ban is itself in doubt; just after the CFPB approved the rule, House lawmakers voted to repeal it. The motion to repeal must still be voted on by the Senate and signed by President Trump to become official, but if it does, then the CFPB’s regulation could be nixed.
On Friday, New York Attorney General Eric Schneiderman took aim at Equifax’s arbitration clause, tweeting that his staff has contacted the company urging it to remove that part of the fine print.
“This language is unacceptable and unenforceable,” the state’s top lawyer said in his tweet. Minutes later, Schneiderman’s office announced a formal probe into the Equifax breach. In a release, the state attorney general’s office said Schneiderman had sent a letter to Equifax asking for more information. Among the questions were whether any consumer information has found its way to the “black market,” according to a person familiar with the investigation.
A spokesperson for Schneiderman declined to comment on whether officials were investigating the sale of company stock by Equifax executives prior to the discovery of the hack.
So should I register with the Equifax site, or not?
It’s up to you, but you should know going into the process what you’re signing up for. There appears to be an escape hatch from the arbitration clause in Equifax’s main terms of use, but it’s unclear if that applies to the credit monitoring program known as TrustedID Premier, whose more specific terms of use may be found here. Both documents contain an arbitration clause.
Here’s what we think we know. According to Joel Winston, a former deputy attorney general for the state of New Jersey and a privacy and data protection lawyer, you are not bound by any of Equifax’s terms of use if you do not engage the company at all.
“If you do nothing, these rules don’t apply to you,” he said. But, he added, going to equifaxsecurity2017.com and entering your name and partial Social Security number does likely expose you to at least one of the two documents.
“Something applies to you,” said Winston. “Whether that’s the terms of service of TrustedID Premier, or Equifax’s main terms of service, is unclear. But there’s a very strong argument that some terms apply to you.”
If you move forward and actually sign up for TrustedID Premier, he said, then you’re definitely bound by the specific terms of use of that service — which contains the arbitration clause but not the opt-out provision contained in the main Equifax terms of use.
If you fall into this category, said Winston, then you have almost certainly waived your right to participate in any class-action suit related to the breach.
What about TrustedID Premier’s FAQ?
Some readers have pointed out that Equifax maintains an FAQ about TrustedID Premier, and that the FAQ appears to limit the scope of TrustedID Premier’s terms of use to “the free credit file monitoring and identity theft protection products, and not the cybersecurity incident” that was disclosed this week.
On Friday evening, Equifax issued a statement apologizing for consumers’ inconvenience and reiterated that the arbitration clause and class-action waiver “does not apply to this cybersecurity incident.”
Equifax sends a statement apologizing for consumers’ inconvenience in trying to get support pic.twitter.com/z3ysOx1piP
This language may appear to limit Equifax’s ability to block class-action lawsuits, said Winston, but don’t get complacent.
“Just because someone in the marketing department wrote that the terms of service don’t apply to the cybersecurity incident means nothing compared to the contractual obligations of the terms of use,” he said.
“You could say, ‘What you’re saying here is deceitful,’ but it’s a real gray area,” he said. “If you look back at the TrustedID terms of use, the last paragraph says ‘entire agreement between us,’ which basically reiterates that the terms of service is the entire agreement and anything else you read on the website have no applicability.”
Meanwhile, there’s something else that you should know if you do decide to use Equifax’s website to check if you were affected.
The site demands even more information from you to prove your identity.
To make sure that the person checking the database is really you, Equifax’s data breach site asks for your last name and the final six digits of your Social Security number. This is extremely unusual. While the site is legitimate, the fact that you must volunteer more of what would otherwise be private information may not inspire much confidence.
Is there anything else I can do?
You can still monitor your own credit by obtaining a copy of your credit report. Every year, you can request a free copy of your report from each of the three major credit reporting agencies. This means that you can effectively check your credit for free every four months or so. You can also put a proactive freeze on your credit, which will prevent unauthorized use.
MEXICO CITY — More than 5,000 homes in one city were destroyed. Half of its 19th-century city hall, with its 30 arches, collapsed. The main hospital was so damaged that staff members rushed patients to an empty lot and worked by the light of their cellphones.
By the time the earthquake’s tremors finally faded, at least 36 people in the city, Juchitán de Zaragoza, were dead.
“It’s a truly critical situation,” Óscar Cruz López, the city’s municipal secretary, said Friday. “The city,” he said, and then paused. “It’s as if it had been bombed.”
Over all, the earthquake — the most powerful to hit the country in a century — killed at least 58 people in Mexico, all of them in the southern part of the country that was closer to the quake’s epicenter off the Pacific Coast.
The earthquake, which had a magnitude of 8.2 and struck shortly before midnight on Thursday, was felt by tens of millions of people in Mexico and in Guatemala, where at least one person died as well.
In Mexico City, the capital, which still bears the physical and psychological scars of a devastating earthquake in 1985 that killed as many as 10,000 people, alarms sounding over loudspeakers spurred residents to flee into the streets in their pajamas.
The city seemed to convulse in terrifying waves, making street lamps and the Angel of Independence monument, the capital’s signature landmark, sway like a metronome’s pendulum.
But this time, the megalopolis emerged largely unscathed, with minor structural damage and only two of its nearly nine million people reporting injuries, neither serious, officials said.
In the southern part of the country, however, at least 10 people died in Chiapas State and three died in neighboring Tabasco, including two children: one when a wall collapsed and the other after a respirator lost power in a hospital, officials said.
Photo
Residents of Mexico City gathered outdoors after an earthquake struck off the Pacific Coast, about 450 miles away, late Thursday. Credit
Pedro Pardo/Agence France-Presse — Getty Images
Chiapas officials said that more than 400 houses had been destroyed and about 1,700 others were damaged.
In Oaxaca State, at least 45 people were killed, including the 36 in Juchitán, a provincial city of 100,000 that was devastated.
“A total disaster,” the mayor, Gloria Sánchez López, declared in a telephone interview in which she appealed for help. “Don’t leave us alone.”
President Enrique Peña Nieto flew to the region on Friday afternoon to assess the damage and meet with officials. And several leaders in Latin America and elsewhere offered assistance to Mexico, including the presidents of Colombia, Chile, Ecuador, Bolivia, Venezuela and Spain.
Mexico is also facing the additional threat of Hurricane Katia, which is gathering strength in the Gulf of Mexico and expected to make landfall in Veracruz State early Saturday.
“You can count on us,” President Juan Manuel Santos of Colombia said on Twitter.
Residents in Juchitán spent the morning using backhoes and their bare hands to dig through the wreckage of collapsed buildings and pull the injured, and the dead, from the rubble.
By early afternoon, the efforts had mostly turned from rescues to a cleanup operation, though the municipal secretary, Mr. Cruz, said that workers were still trying to claw through the mounds of debris left by the collapse of the city hall to reach one last victim. Nobody knew if the person was still alive.
“It is a nightmare we weren’t prepared for,” said a member of the City Council, Pamela Teran, in an interview with a local radio station. She estimated that 20 to 30 percent of the houses in the city were destroyed.
“A lot of people have lost everything, and it just breaks your heart,” she added, bursting into tears.
SEPT. 8, 2017
By The New York Times
With the hospital — the region’s main medical center — destroyed, officials converted a grade school into a makeshift clinic and moved the hospital’s patients and the hundreds of injured survivors there.
Local officials appealed to state and federal governments for aid to help with the recovery.
“It’s impossible to resolve this catastrophe, to respond to something of this magnitude, by ourselves,” Mr. Cruz said.
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Aftershocks continued through the day Friday, unnerving the city’s residents, many of whom spent much of the day out in the street rather than return to their homes, said Juan Antonio García, the director of the Juchitán news website Cortamortaja.
Reports of damage elsewhere in the region continued to emerge throughout the afternoon. In Union Hidalgo, just to the east of Juchitán, the mayor reported that about 500 houses had been destroyed.
Schools in at least 10 Mexican states and in Mexico City were closed on Friday as the president ordered an assessment of the damage nationwide.
“We are assessing the damage, which will probably take hours, if not days,” President Peña Nieto said in televised comments to the nation two hours after the quake.
Throughout the day Mexicans lined up at emergency collection centers around the country to donate food, water and other supplies for delivery to the earthquake victims.
Mexico is situated near the colliding boundaries of several portions of the earth’s crust.
The quake on Thursday was more powerful than the one in 1985 that flattened or seriously damaged thousands of buildings in Mexico City.
While the quake on Thursday struck nearly 450 miles from the capital, off the coast of Chiapas State, the one in 1985 was much closer to the capital, so the shaking proved much more deadly.
Photo
Patients in a clinic in Puebla, Mexico, were taken outside after the quake. Credit
Imelda Medina/Reuters
After the 1985 disaster, construction codes were reviewed and stiffened. Today, Mexico’s construction laws are considered as strict as those in the United States or Japan.
Though many Mexicans have grown accustomed to earthquakes, taking them as an immutable fact of life, Thursday’s quake left a lasting impression on residents of the capital for both its force and duration.
“The scariest part of it all is that if you are an adult, and you’ve lived in this city your adult life, you remember 1985 very vividly,” said Alberto Briseño, a 58-year-old bar manager. “This felt as strong and as bad.”
“Now we will do what us Mexicans do so well: take the bitter taste of this night and move on,” he added.
The quake occurred near the Middle America Trench, a zone in the eastern Pacific where one slab of the earth’s crust, called the Cocos Plate, is sliding under another, the North American, in a process called subduction.
The movement is very slow — about three inches a year — and over time stress builds because of friction between the slabs. At some point, the strain becomes so great that the rock breaks and slips along a fault. This releases vast amounts of energy and, if the slip occurs under the ocean, can move a lot of water suddenly, causing a tsunami.
Subduction zones ring the Pacific Ocean and are also found in other regions. They are responsible for the world’s largest earthquakes and most devastating tsunamis.
The magnitude-9 earthquake off Japan in 2011, which led to the Fukushima nuclear disaster, and the magnitude-9.1 quake in Indonesia in 2004, which spawned tsunamis that killed a quarter of a million people around the Indian Ocean, are recent examples.
Those quakes each released about 30 times as much energy as the one in Mexico.
Mexico’s government issued a tsunami warning off the coast of Oaxaca and Chiapas after Thursday’s quake, but neither state appeared to have been adversely affected by waves.
In Guatemala, the military was out Friday morning assessing the damage, found mainly in the western part of the country.
In Huehuetenango, bricks and glass were strewn on the ground as walls in the city collapsed. Quetzaltenango, Guatemala’s second-largest city, which was beginning to recover from a tremor in June, suffered more damage to its historic center.
