{"id":2614,"date":"2019-05-22T22:45:24","date_gmt":"2019-05-22T22:45:24","guid":{"rendered":"http:\/\/www.blackopspartners.com\/?p=2614"},"modified":"2019-05-22T22:45:24","modified_gmt":"2019-05-22T22:45:24","slug":"equifax-just-became-the-first-company-to-have-its-outlook-downgraded-for-a-cyber-attack","status":"publish","type":"post","link":"https:\/\/blackopspartners.com\/equifax-just-became-the-first-company-to-have-its-outlook-downgraded-for-a-cyber-attack\/","title":{"rendered":"Equifax just became the first company to have its outlook downgraded for a cyber attack"},"content":{"rendered":"\n

Moody\u2019s has just slashed its rating outlook on Equifax<\/a>, the first time cybersecurity issues have been cited as the reason for a downgrade.<\/p>\n\n\n\n

Moody\u2019s<\/a> lowered Equifax\u2019s<\/a> outlook from stable to negative on Wednesday, as the credit monitoring company continues to suffer from the massive 2017 breach of consumer data<\/a>.<\/p>\n\n\n\n

\u201cWe are treating this with more significance because it is the first time that cyber has been a named factor in an outlook change,\u201d Joe Mielenhausen, a spokesperson for Moody\u2019s, told CNBC. \u201cThis is the first time the fallout from a breach has moved the needle enough to contribute to the change.\u201d<\/p>\n\n\n\n

Equifax could not immediately be reached for comment.<\/p>\n\n\n\n

The decision is significant because investors increasingly look to ratings firms and insurance companies to adequately predict the longer-term fallout of some of the biggest breaches, a difficult task given the relative lack of historical data on these incidents.<\/p>\n\n\n\n

Moody\u2019s cited Equifax\u2019s recent $690 million first-quarter charge for the breach as contributing to the downgrade. The expense represents the company\u2019s estimate for settling ongoing class action cases, as well as potential federal and state regulatory fines.<\/p>\n\n\n\n

The note also cited Equifax\u2019s hefty cybersecurity investments as problematic for its future strength.<\/p>\n\n\n\n

\u201cWe estimate Equifax\u2019s cybersecurity expenses and capital investments will total about $400 million in both 2019 and 2020 before declining to about $250 million in 2021,\u201d the note says. \u201cBeyond 2020, infrastructure investments are likely to remain higher than they had been before the 2017 breach.\u201d<\/p>\n\n\n\n

Moody\u2019s also said Equifax may not be alone.<\/p>\n\n\n\n

\u201cThe heightened emphasis on cybersecurity for all data oriented companies, which is especially acute for Equifax, leads us to expect that higher cybersecurity costs will continue to hurt the company\u2019s profit and free cash flow for the foreseeable future,\u201d Moody\u2019s said.<\/p>\n\n\n\n

The firm recently said<\/a> it\u2019s working on building cyber risk into its credit ratings, which would put corporations on the hook for their cybersecurity practices. Moody\u2019s has indicated that the types of companies most at risk include financial firms, securities firms, hospitals, market infrastructure providers and electric utilities.<\/p>\n\n\n\n

As CNBC\u00a0previously reported<\/a>, the stolen Equifax data has never been found and intelligence officials largely believe it has been collected and used for foreign intelligence purposes.<\/p>\n\n\n\n

Read more at CNBC.<\/a><\/em><\/p>\n","protected":false},"excerpt":{"rendered":"

Moody\u2019s has just slashed its rating outlook on Equifax, the first time cybersecurity issues have been cited as the reason for a downgrade. Moody\u2019s lowered Equifax\u2019s outlook from stable to negative on Wednesday, as the credit monitoring company continues to suffer from the massive 2017 breach of consumer data. \u201cWe are treating this with more significance because it is the […]<\/p>\n","protected":false},"author":2,"featured_media":0,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[10],"tags":[36,25,29],"acf":[],"_links":{"self":[{"href":"https:\/\/blackopspartners.com\/wp-json\/wp\/v2\/posts\/2614"}],"collection":[{"href":"https:\/\/blackopspartners.com\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/blackopspartners.com\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/blackopspartners.com\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/blackopspartners.com\/wp-json\/wp\/v2\/comments?post=2614"}],"version-history":[{"count":0,"href":"https:\/\/blackopspartners.com\/wp-json\/wp\/v2\/posts\/2614\/revisions"}],"wp:attachment":[{"href":"https:\/\/blackopspartners.com\/wp-json\/wp\/v2\/media?parent=2614"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/blackopspartners.com\/wp-json\/wp\/v2\/categories?post=2614"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/blackopspartners.com\/wp-json\/wp\/v2\/tags?post=2614"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}