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Equifax’s Data Breach Should Prop Up These Cybersecurity Stocks

Author: Richard Saintvilus / Source:

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Betting on cybersecurity stocks has been a profitable trade in 2017. Thanks to the number of high-profile hacking-related headlines that have hit retailers and corporations, both the First Trust Nasdaq Cybersecurity ETF (CIBR) and ETFMG Prime Cyber Security ETF (HACK) — up 11% and 14%, respectively — have padded many portfolios.

And this was before the most recent breach involving credit reporting agency Equifax Inc. (EFX), where 143 million consumer records were exposed to the breach on September 7. The company last week admitted that it failed to fix a vulnerability called “Apache Struts.” And here’s the thing: This vulnerability, which was exploited by the attackers, was first discovered in March — a good six months before the breach took place.

Why this liability wasn’t fixed? Only the company knows. But given that some of Equifax’s customers are mainly financial institutions such as mortgage lenders, banks and credit card issuers, which supply Equifax with consumer transaction records, it’s likely your problem too.

And if you’re among those whose records were stolen, this means you’re now vulnerable to not only phishing attacks, but also possible unauthorized new credit card accounts, which can damage your credit history.

As expected, heads at Equifax have begun to roll as various class-action suits are being formed. On Friday the company…

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