Artist's impression of the deal being altered.
Enlarge / Artist’s impression of the deal being altered.
Disney / 20th Century Fox

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If you’re one of the millions of Americans who received an email this weekend from the Equifax breach settlement administrator, you’re not alone. Nor are you alone if you were surprised or confused by the message, as more than a half-dozen Ars readers who forwarded theirs were. The message, however, is entirely legitimate, and the information it seeks is part of the claims process.

Equifax and the Federal Trade Commission in July reached a settlement relating to the company’s completely massive data breach of more than 140 million Americans. As part of that agreement, anyone whose data was part of the breach could file a claim to receive either cash compensation or several years of free credit monitoring.

In order to receive the cash compensation, however, claimants certified that they already have some form of credit monitoring services in place. Such services are not only freely available to many credit card and bank account holders, but also are routinely given out to customers whose data is lost in a breach, and so tens of millions of claimants did indeed ask for the cash instead.

Further Reading

Warren: FTC’s $125 cash option in Equifax settlement “misled” customers

The fund for paying out cash compensation, however, is capped at $31 million—nowhere near as much money as Equifax would need in order to compensate the millions of claimants.

The first step in winnowing down the claims, therefore, is to make everyone who said they have credit monitoring actually provide the name of the service they use, and that’s what the settlement administrator is asking for with the recent email.

A screenshot of the email sent by the Equifax Breach Settlement administrator to claimants who requested the $125 cash compensation alternative.
Enlarge / A screenshot of the email sent by the Equifax Breach Settlement administrator to claimants who requested the $125 cash compensation alternative.

The FTC’s information page about the settlement warns claimants that this verification is part of the process:

The settlement administrator will be sending an email to people who already submitted a claim for the alternative cash payment. In that email, you will have the option to:

1) provide additional information OR

2) switch to free credit monitoring.

Wait for the email from the settlement administrator if you want to amend your claim form. The settlement administrator has said that the claims website will soon be updated with this information, too.

Overcompensation

The email asking claimants to verify their other credit monitoring services has an October 15 deadline, and that’s important. Anyone who doesn’t respond before that deadline will have their claim denied outright.

The email (and the FTC) also both strongly urge claimants to “amend” their claims and swap from the cash claim to the free credit monitoring, because of the “overwhelming” response to the cash option.

“The amount you receive in connection with your alternative compensation claim may be significantly reduced depending on how many valid claims are ultimately submitted by other class members for this relief,” the email says. “Based on the number of potentially valid claims that have been submitted to date, payments of these benefits likely will be substantially lowered and will be distributed on a proportional basis if the settlement becomes final. Depending on the number of valid claims that are filed, the amount you receive for alternative compensation may be a small percentage of your initial claim.”

In short, unless there are fewer than 240,000 claimants—unlikely, given that about 147 million people were affected—nobody’s getting $125. You may, however, still get something if you fill out the required information before the deadline.