Capital One target of massive data breach

Tim Jimenez
July 30, 2019 - 7:02 am
In this July 16, 2019, photo, a man walks across the street from a Capital One location in San Francisco.

Jeff Chiu/AP Photo


PHILADELPHIA (KYW Newsradio, Associated Press) — A major data breach is affecting more than 100 million Capital One credit card customers and applicants. The FBI arrested the hacker who was behind the breach.

Authorities say 33-year-old Paige Thompson of Seattle was a software engineer for a cloud hosting company that Capital One was using, and she exploited a vulnerability in a firewall, gaining access to truckloads of information from credit card applications dating back to 2005. 

Authorities say she had at her fingertips social security numbers, bank account details, addresses, credit scores and more. About 100 million Americans and 6 million Canadians were affected in some way. 


Mark McCreary, chief privacy officer at Philadelphia-based law firm Fox Rothschild, says companies do background checks to avoid hiring someone who might commit a data breach like this, but there's only so much a company can do when someone goes rogue.

"Until somebody actually gets caught doing one of these type of nefarious acts, you can't actually go by anything else in their background that's going to tell you that they're gonna lead to this type of action or this type of compromise. It's a very difficult thing to predict," he said.

In this particular case, Capital One says the hack happened in March, but they didn't find out about it until a week and a half ago, because of Thompson's loose lips. Officials say she had been talking in some chat groups about having access to this data, and someone reported her to the FBI. 

Capital One is contacting everyone affected by the breach and will offer free credit monitoring and ID theft protection.

McCreary says he expects a class-action lawsuit will follow, as these data breaches are becoming part of everyday life. 

"Between Equifax and all the other breaches that have occurred over the years, we've all become somewhat numb to this," he said. "The numbers are mind-boggling, and in reality your information is already on the dark Web, it's already accesible. If people want to go find it, they can."

Thompson — who also goes by the handle "erratic" — was charged with a single count of computer fraud and abuse in U.S. District Court in Seattle. Thompson made an initial appearance in court and was ordered to remain in custody pending a detention hearing Thursday.

She got information including credit scores and balances plus the Social Security numbers of about 140,000 customers, the bank said. It will offer free credit monitoring services to those affected.

The FBI raided Thompson's residence Monday and seized digital devices. An initial search turned up files that referenced Capital One and "other entities that may have been targets of attempted or actual network intrusions."

A public defender appointed to represent Thompson did not immediately return an email seeking comment.

Capital One, based in McLean, Virginia, said Monday it found out about the vulnerability in its system July 19 and immediately sought help from law enforcement to catch the perpetrator.

According to the FBI complaint, someone emailed the bank two days before that notifying it that leaked data had appeared on the code-hosting site GitHub, which is owned by Microsoft.

And a month before that, the FBI said, a Twitter user who went by "erratic" sent another user direct messages warning about distributing the bank's data, including names, birthdates and Social Security numbers. That user later reported the message to Capital One.

"Ive basically strapped myself with a bomb vest, (expletive) dropping capitol ones dox and admitting it," one said. "I wanna distribute those buckets i think first."

Capital One said it believes it is unlikely that the information was used for fraud, but it will continue to investigate. 

The bank said the bulk of the hacked data consisted of information supplied by consumers and small businesses who applied for credit cards between 2005 and early 2019. In addition to data such as phone numbers, email addresses, dates of birth and self-reported income, the hacker was also able to access credit scores, credit limits and balances, as well as fragments of transaction information from a total of 23 days in 2016, 2017 and 2018.

"While I am grateful that the perpetrator has been caught, I am deeply sorry for what has happened," said Capital One CEO Richard D. Fairbank. "I sincerely apologize for the understandable worry this incident must be causing those affected and I am committed to making it right."

Capital One Financial Corp., the nation's seventh-largest commercial bank with $373.6 billion in assets as of June 30, is the latest U.S. company to suffer a major data breach in recent years.

In 2017, a data breach at Equifax, one of the major credit reporting companies, exposed the Social Security numbers and other sensitive information of roughly half of the U.S. population.

Last week, Equifax agreed to pay at least $700 million to settle lawsuits over the breach in a settlement with federal authorities and states. The agreement includes up to $425 million in monetary relief to consumers.

Many major banks have sought to stem the risk of data breaches in recent years. JPMorgan Chase, Bank of America and Citibank began replacing customers' debit cards several years ago with more secure chip-based cards. While the cards with chips are common these days, many merchants still rely on the older, less secure card-swiping equipment. Credit card companies have also beefed up fraud monitoring in the wake of high-profile data breaches that hit retailers such as Target and Home Depot.

The average cost of a data breach in the U.S. last year was just under $8 million, according to a study by IBM Security and Ponemon Institute.


Associated Press reporters Gene Johnson in Seattle and Alex Veiga in Los Angeles contributed to this article.

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