A Florida data broker that lost hundreds of millions of Social Security numbers and other personally identifiable information in a data breach earlier this year, has filed for Chapter 11 bankruptcy protection as the company faces a wave of litigation.
Jericho Pictures, the parent company of the hacked data broker National Public Data, told a Florida bankruptcy court that it was unlikely to be able to repay its debtors or address its anticipated liabilities and class-action lawsuits, including paying "for credit monitoring for hundreds of millions of potentially impacted individuals."
In its initial filing, Jericho Pictures' owner, Salvatore Verini, said the company "faces substantial uncertainty facing regulatory challenges by the Federal Trade Commission and more than 20 states with civil penalties for data breaches."
News of the bankruptcy was first reported by PCMag.
Since April, a hacker with a history of selling stolen data claimed to have breached National Public Data and stolen billions of records, affecting around 300 million people, making it one of the largest data breaches of the year.
Per the data broker's data breach notice on its website, the stolen data includes names, dates of birth, email and postal addresses, phone numbers, and Social Security numbers. Given the nature of the information that data brokers collect, some of the stolen data was accurate, some of it was not, and much of it related to people who were deceased.
The company's stolen database contained about 270 million Social Security numbers in total, security researchers estimated.
According to the bankruptcy filings, Verini valued the company's stolen database of Social Security numbers at $1 million. The filing also lists several other databases the company maintains as assets, but did not provide corresponding valuations. Those datasets pertain to individuals licensed by the Drug Enforcement Administration to write prescriptions for controlled substances; those with permits to carry concealed weapons; and banks of data containing public records, such as marriages, divorces, bankruptcy filings, and international financial sanctions; among others.
It's unlikely that the lawsuits or enforcement action will result in any compensation for those affected, given what little is left in the company's coffers.
The data broker's bankruptcy filings revealed its insurance provider "declined coverage" following the data breach, and that the company had fewer than $75,000 in total assets. Much of the company's revenue went to purchases of bulk data, and to Verini's pay as the company's sole operator. As required by the bankruptcy filing, the company disclosed net profits of $475,526 in 2022 and $865,149 during 2023.