Looks like Democratic Senator Heidi Heitkamp is getting her wish. After demanding that "somebody needs to go to jail" during a Congressional hearing about the Equifax breach late last year, the Department of Justice on Wednesday charged Jun Ying, the former chief information officer of one Equifax business unit, with insider trading, claiming he knowingly sold shares before the company revealed a massive data breach last year.
As has been reported, three Equifax executives sold shares worth almost $1.8 million in early August, during the period when the company had discovered the hack, but it had not yet been publicly disclosed, according to the Financial Times.
Ying reportedly sold $1 million on stock after learning of the breach, prosecutors said.
As we pointed out at the time, soaring put volume in Equifax shares ahead of the announcement was indicative of "massive insider selling" - which would suggest that the money disclosed so far is only the tip of the iceberg.
The SEC said Ying had avoided more than $117,000 in losses by disposing of his shares before the breach became public.
"This defendant took advantage of his position as Equifax’s USIS Chief Information Officer and allegedly sold over $950,000 worth of stock to profit before the company announced a data breach that impacted over 145 million Americans," said Byung Pak, US attorney for the northern district of Georgia.
According to Bloomberg, Ying allegedly used confidential information entrusted to him by the company to determine it had been hacked, the SEC said. The US Attorney’s office in Atlanta has also filed criminal charges against Ying.
Sensitive financial data from more than 150 million Americans was stolen by hackers during the heist, which investigators swiftly discovered could've easily been prevented if the company had bothered to install one routine patch to its security system. Perhaps it would've been more careful about security if its chief information security officer had an appropriate background. Instead, the former Equifax executive had earned a degree in Fine Arts from the University of Georgia.
Back in September, the US DOJ opened a criminal probe into whether top Equifax officials had violated insider trading laws. As we've noted, three Equifax Inc. senior executives, Chief Financial Officer John Gamble, and Presidents Joseph Loughran and Rodolfo Ploder, sold shares in the days after the company discovered the breach. Ying's selling was not previously widely known. In an internal probe, Equifax determined that none of the executives knew about the breach when they sold the shares, per CNN.