Verizon to pay $500m to settle privacy and data breaches

Verizon has agreed to pay up to $500 million to settle a class-action lawsuit over its alleged data breach and privacy breaches.

Key points:The US Federal Trade Commission (FTC) has ordered Verizon to hand over all data relating to consumers and the company has agreed it will hand over a “substantial” number of its mobile data devicesThe company will also pay a $2m settlement to settle allegations of breach of contractVerizon will also reimburse consumers for their moneyVerizon has faced criticism over the number of data breaches and privacy violations, with critics saying the company failed to protect consumers’ privacy.

The FTC has said that Verizon’s “data breach” and “privacy violation” claims were based on an assumption that consumers did not “need” the data in order to access it, rather that it was necessary in order for the data to function.

The US company has said it had “robust” privacy policies and practices and had a robust data security policy, and that it had a “zero-tolerance” policy for breaches.

Verizon also agreed to reimburse consumers up to the amount of their data costs, but not in full, which is what was previously demanded by the FTC.

Verizos data breach settlementThe FTC is expected to formally announce its decision on Thursday.

“The FTC’s enforcement actions will result in a significant financial relief for consumers and will also prevent future data breaches that could result in serious harm to consumers’ data, privacy, and safety,” the FTC said in a statement.

The company has already agreed to handover data related to consumers for two years, and will pay $250,000 in the amount to settle claims from consumers and law enforcement agencies.

Verizons privacy policies have been the subject of a number of investigations, with one case currently before the Federal Court of Federal Claims.

Verified Privacy PolicyVerizon said in the settlement agreement that it would take steps to provide consumers with an “unlimited number of options” to protect their personal information, and it would provide “substantially increased” information security measures, including data encryption and a data breach notification service.

Verision will also provide consumers “clear and understandable information about how their personal data will be handled, including how to opt out of sharing it with third parties”.

Verizon’s data breach resolution agreementThe FTC said Verizon was a “significant target for the alleged data breaches” and that the company “failed to protect privacy rights and the public from a widespread data breach”.

The FTC also said Verizon’s privacy breach and breach of privacy claims were unfounded, and the settlement “resulted from an inaccurate assumption that consumer privacy was not needed to access the company’s data.”

Verizon, which was acquired by AT&T in 2012 for $7.6bn, has been hit with numerous privacy complaints since it bought its data security company, Verizon Wireless.

The telco was criticised in the Federal Trade Commissioner’s Office in November for allegedly misleading consumers, and in November, it admitted to having “robusted” its privacy policies.

In May, it was revealed that Verizon was selling personal information of its customers to third parties for the purpose of “advertising” its wireless service.

The carrier also told customers that it could not be held liable for its privacy breaches and breaches of contract.

Verity said it was committed to privacy and security, and said it would not make changes to its privacy practices or practices that are “in any way inconsistent with our commitments”.