A Texas insurance agent has filed a class action lawsuit against Yahoo, claiming that the company’s recent email hacking problems led to the theft of his personal information that was then used to rack up fraudulent charges on his credit cards.
Brian Neff of Little Elm, Texas, a north Dallas suburb, used Yahoo for his online insurance business’ web hosting and email services. Two of his credit cards were on file with Yahoo to pay for those services. Following the Yahoo data breaches, both cards incurred fraudulent charges and were also used to open other credit card accounts.
Yahoo reported data breaches that affected more than a billion accounts in 2013 and at least 500 million accounts in 2014. According to a Yahoo filing with the Securities and Exchange Commission, the company knew of the 2014 data breach for almost two years before making it public. Customer data stolen in the massive hack included email addresses, dates of birth, telephone numbers, scrambled passwords and security questions and answers.
The class action filed by Neff alleges that Yahoo was negligent in failing to take reasonable steps to protect user data, failing to prevent the data breaches, failing to notify users that the company had inadequate data security and failing to promptly notify users of the data breaches.
When it finally released information on the data breaches, Yahoo’s statement said that no payment card data or bank account information was stolen. However, the lawsuit noted, “The probability that separate criminals stole card information from separate sources, stole the information necessary to open a new credit card account from a separate source, and made fraudulent charges on all three cards in the same month is staggeringly remote.”
Neff’s suit seeks certification of a plaintiff class made up of small business customers of Yahoo and unspecified damages.
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