This didn’t take long. It was announced last week that Equifax CEO Richard Smith would be stepping down. This move is part of the company’s attempts to get past the massive breach scandal that rocked the credit reporting industry.
According to multiple media stories, Equifax was hacked, putting the accounts of about 143 million Americans at risk. From the beginning, it was pretty clear someone’s head would roll. Smart money was on Smith. But he didn’t depart on his own. Two more Equifax executives were ousted after the announcements. Smith, who has been CEO since 2005, stands to take the most heat, though, even if he’s no longer with the company when all the investigations are completed. That said, the terminology being used to announce Smith’s departure is interesting. Perhaps another layer of Equifax’s attempts to regain consumer trust.
The company is publicly referring to Smith’s departure as “retirement,” though it’s been released that he won’t be getting his annual bonus or some other retirement benefits. Those are up in the air until the board completes its review of the case. So, “retirement” isn’t fooling anyone. They will use that term for now, but if Equifax needs a fall guy, and they determine they have enough on Smith to make him the guy, that term is probably going to change. In the meantime, Equifax has named a new interim CEO, Paulino do Rego Barros, Jr., whose most recent gig was as president of the Asia Pacific region. But Equifax has made it fairly clear Barros is just keeping the seat warm for someone else. Their official announcement is that they would be looking both “inside and outside the company” for a new CEO.
And that’s far from the only thing on their plate. Even with ousting Smith and the others, the company still faces major problems that will keep them in the news for some time to come. Equifax will have to endure multiple state and federal inquiries as well as class-action lawsuits, congressional investigations, and FTC investigations. It’s also expected that several state attorneys general will be conducting their own investigations into the breach.
Bottom line, Equifax has a long way to go just to get past all the trouble before they can begin re-establishing their reputation. In the meantime, 143 million customers are worried their identities are going to be compromised, and their credit is going to be ruined by strangers. Should that happen, this PR crisis will get exponentially worse.
Ronn Torossian is the Founder and CEO of the New York based public relations firm 5WPR: one of the 20 largest PR Firms in the United States.