Class action lawsuits are one way in which a large group of individuals with a similar grievance, or who have been wronged similarly by a large organization or entity, can come together as a collective power to fight for justice and receive money in their bank accounts. When this happens, there is a higher likelihood that plaintiffs will win than if they individually fought their case. LoanCare, a cybersecurity company, has recently agreed to a settlement with plaintiffs after a two-year litigation with plaintiffs over data leakage.
The legalities behind breaching client data
In a digital world, understanding the legalities behind data breaches and your rights as a consumer is more crucial than ever. When it comes to data privacy and security, in the US, key federal laws to protect your information and privacy are as follows:
- Gramm-Leach Bliley Act (GLBA)
- Fair Credit Reporting Act (FCRA)
- FTC Act (Section 5)
GLBA applies to financial institutions and is intended to protect consumers’ financial information. Financial institutions are required to provide full transparency to consumers over what their information is used for, as well as guarantee that strong data protection measures are put in place to protect consumer information. The FCRA is for credit reporting agencies and ensures accuracy and transparency in credit reporting between the consumer and the agency. The FTA Act applies to all businesses in the US and requires that all companies and businesses be transparent about how consumer data is used and with whom it is shared.
LoanCare settles $5.9 million lawsuit
Earlier this month, LoanCare recently agreed to settle a $5.9 million class action lawsuit with plaintiffs over a 2023 data breach, where the company failed to prevent the compromise of sensitive information of their consumers. The settlement is applicable for those who received a data breach settlement notice from the company in November 2023 informing consumers that their data may have been compromised.
Plaintiffs have argued that the data breach could have been prevented if LoanCare has taken better cybersecurity measures to protect consumer data. The data breach impacted the names of consumers, addresses, Social Security numbers, and loan numbers. As part of the settlement deal, plaintiffs can either agree to a reimbursement for documented expenses or losses or a flat-rate payment.
Up to $6,500 can be claimed by plaintiffs
If you opt for reimbursement payments, you can receive a maximum payment of $1,500 for ordinary losses as well as claim up to $5,000 for extraordinary losses. Class members who did not experience any losses or do not wish to claim a reimbursement can receive a flat payment of $100. Plaintiffs have until June 4 to submit a claim. The deadline for exclusion is July 7, while the deadline for objection is August 5. The final approval hearing will take place on September 4.
Ordinary losses included credit monitoring services, fees, communication charges, and other unreimbursed expenses, while extraordinary losses include unreimbursed fraud or identity theft damages. If you claim either or both of these, you need to ensure that your claim category is documented when you submit. In addition, as part of the settlement, plaintiffs are awarded three years’ worth of identity monitoring services.
As part of these services, plaintiffs are awarded real-time credit monitoring, dark web scanning, up to $1 million in identity theft insurance, access to fraud specialists, and identity theft restoration services. If you are a class member who previously opted to receive 24 months of identity monitoring services offered by LoanCare, you will be granted an additional year of identity monitoring. These precautions are to ensure that any data that was compromised is monitored for its use in fraud. For more information about this settlement, you can visit Top Class Actions and get informed about how to file a claim.
