Yahoo released a statement on Sept. 26 confirming reports that its systems had been hacked two years ago. As a result, the account information — including names, email addresses, telephone numbers, birth dates, passwords and in some cases security questions — of at least 500 million users was stolen in 2014. The announcement comes as Verizon Communications moves forward with a $4.8 billion acquisition of the company.
While there is much uncertainty as to how this announcement could affect the acquisition, according to Drexel University’s Murugan Anandarajan, PhD, the head of the Department of Decision Sciences in Drexel’s LeBow College of Business, a hack like this can have major implications for the deal.
“The main issues will include the potential lawsuits, penalties and settlements,” said Anandarajan, who also collaborates on research with Drexel’s Isaac L. Auerbach Cybersecurity Institute. “The loss of trust can lead to loss of customers. There are also costs and policies that need to be implemented to ensure the company is compliant with the laws of the various states impacted by the breach. The cost of such issues can run into the billions. This will have an impact on the companies future growth plans as well. For example, units of business may need to be closed, or new hires may not take place.”
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