A former Equifax executive has been charged by US authorities with insider trading, accused of selling off all of his stock in the credit rating agency last summer before it revealed it had suffered a massive data breach.
Jun Ying, who was CIO at Equifax’s US Information Solutions, faces charges from both the Justice Department and the Securities and Exchange Commission after selling nearly a million dollars of stock in his employer before news of the breach became public.
According to authorities, last August Ying became aware of information suggesting that Equifax had been hit by hackers. On Friday, 25 August 2017, he texted a co-worker that the breach they were working on “Sounds bad. We may be the one breached.”
The following Monday, Ying conducted web searches on the impact of Experian’s 2015 data breach on its stock price. Later that morning, he exercised all of his available stock options held at UBS Financial Services, resulting in him receiving 6,815 shares of Equifax stock, which he then sold, receiving $950,000, realising a gain of over $480,000.
On September 7, 2017, Equifax publicly announced its data breach, which affected around 148 million US customers. Shares in the firm, which had been trading at almost $143, fell 18% in the wake of the news. According to the SEC complaint, by selling before public disclosure of the data breach, Ying avoided more than $117,000 in losses.
Richard Best, director, Atlanta regional office, SEC, says: “Corporate insiders who learn inside information, including information about material cyber intrusions, cannot betray shareholders for their own financial benefit.”