Following its breach more than six months ago—and with the new revelation that millions more Americans were impacted—Equifax is not surprisingly the least trusted credit bureau, according to new data from Auriemma Consulting Group. While this may be a natural outcome of such a high-profile event, the research shows there has been a ripple effect that has weakened trust in competitors like Experian and TransUnion, sparking consumer skepticism about how credit bureaus are protecting data.
But while consumers’ trust in credit bureaus has been damaged by the breach, they continue to express confidence in their banks’ and issuers’ ability to protect their financial information—82 percent of cardholders believe their financial accounts are secure and about 80 percent reporting confidence in their bank’s and/or credit card issuer’s ability to protect their financial information.
Although the Equifax breach wasn’t the largest data breach of all time, the bureau received increased scrutiny from government officials and consumers alike for not having the same regulatory oversight on data protections as banks, issuers and other financial institutions. In January, senators introduced a bill to create mandatory penalties for data breaches at credit reporting agencies.
While the political reality of such measures is unclear, it could be championed by the public: According to Auriemma, 78 percent of consumers believe credit bureaus should be subject to greater regulation. Recent news places the Equifax investigation on hold, however, as sources recently said interim director Mick Mulvaney has yet to request subpoenas against the reporting agency or sought sworn testimony from its executives.
Consumers’ trust in Equifax has been eroded
Thirty-one percent believe they were impacted by the Equifax breach, which also likely affected trust for all credit bureaus, according to Auriemma. One-quarter (25 percent) say they have don’t trust any of the reporting agencies with their financial information. Only 10 percent of cardholders say they trust each of the credit agencies a lot. Equifax falls at least 10 points behind TransUnion and Experian in credit cardholders that have at least a little trust in each respective credit agencies.
“While levels of trust with TransUnion and Experian are near equal, Equifax is likely suffering from the handling of its recent data breach,” said Jaclyn Holmes, director of Auriemma’s Payment Insights practice, in a news release. “The level of distrust is even more stark among those who believe they were impacted by the breach—just over half of those individuals no longer trust Equifax with their financial information.”
Poor crisis handling leads reasons for distrust
More than half (53 percent) of respondents believe the Equifax breach was handled poorly by the company, likely due to the delayed response and remediation efforts. But Equifax’s eventual efforts to communicate with and provide ID theft protections to impacted consumers did not go unnoticed by the remaining 47 percent of respondents, who say the bureau responded at least somewhat well.
While Equifax offered web-based tools to help consumers post-breach, a very low proportion (38 percent) of respondents who believe they were impacted used these tools. Impacted consumers opted to check their credit report themselves more frequently than those not impacted (46 percent versus 21 percent), began monitoring their existing credit and bank accounts more closely (46 percent versus 18 percent), enabled two-factor authentication where possible (23 percent versus 6 percent), and placed fraud alerts and credit freezes on file (21 percent versus 3 percent).
“Even among those who say they’re certain they were impacted, only half say they visited http://www.equifaxsecurity2017.com to see if they were exposed—which speaks to a general weariness for Equifax’s online portal and their response to the breach,” says Holmes.
This study was conducted online within the US by an independent field service provider on behalf of Auriemma Consulting Group among 800 US adult credit cardholders in November 2017. The number of interviews completed for both is sufficient to allow for statistical significance testing among sub-groups at the 95% confidence level ±5%, unless otherwise noted. The purpose of the research was not disclosed, nor did respondents know the criteria for qualifying. The average interview length was 20 minutes.