The company, which collects and sells access to consumers’ personal information, also said the Securities & Exchange Commission (SEC) has concluded its investigation into the sale of ChoicePoint stock by chief executive Derek Smith and chief operations officer Doug Curling, without recommending any enforcement action by the SEC.
The SEC investigation involved the sale of nearly $18 million worth of ChoicePoint stock by the two executives prior to the breach disclosure.
ChoicePoint said the settlement would have no impact on its financial results, as the money was to be paid from a reserve insurance fund already set aside to cover expenses and costs relating to the breach. Neither the company nor any of the defendants admitted to any liability and the agreement is subject to court approval.
The company earlier paid $15 million in civil and consumer penalties to the Federal Trade Commission (FTC) and agreed to tighten its security procedures as well as submit to random audits to ensure it was properly protecting personal information.
At the time the FTC described the fine as the largest it had ever imposed.
The company also paid $500 000 to settle lawsuits brought by the attorneys general of 44 states for its lax handling of personal data that led to the breach.
ChoicePoint, which has about 19 billion records, collects data on individuals, including social security numbers, real estate holdings and current and former addresses. The theft, which was detected in the fall of 2004, was not disclosed to the public until February 2005.
The data breach occurred when identity thieves posed as small business customers to gain access to ChoicePoint’s consumer data.
The incident prompted the company to make some changes, such as hiring former Transportation Security Administration head Carole DiBattiste as its privacy officer and hiring legal counsel Katherine Bryan as its consumer advocate.
On January 24, the company announced its latest quarterly results. For Q4 it reported losses of $32.32 million, or 47 cents a share, compared with a profit of $23.67 million, or 30 cents a share, for the previous year. Total revenue was $239.3 million in the fourth quarter, compared to $238.7 million in 2006.