SEC Investigating Yahoo Over Timeline of Data Breach Disclosure
The Securities and Exchange Commission is investigating whether Yahoo should have reported two data breaches to its investors in a more timely manner.
In December, the SEC requested documents from the tech company to determine whether their disclosures about the attacks complied with civil securities laws. In the United States, companies must immediately disclose cybersecurity risks and attacks to their investors as soon as it is determined it will have an affect on shareholders.
Last month, Yahoo announced a 2013 breach that affected one billion accounts, but the SEC investigation will likely center on a 2014 breach that affected at least 500 million users, according to The Wall Street Journal. Even though the company had linked this attack to state-sponsored hackers in 2014, they did not announce the breach until September 2016. Many have questioned why they waited two years to disclose this information, even though employees knew about the breach much earlier.
This most recent announcement once again calls into question Yahoo’s $4.8 billion deal with Verizon. Initially, the acquisition was scheduled to close at the end of the first quarter in 2017, and Yahoo said “integration planning” has begun. However, Yahoo announced earlier this week that the acquisition will be completed “as soon as is practicable in the second quarter.”
Despite these new developments, Yahoo CEO Marissa Mayer voiced optimism about the future of the company.
“I’m very pleased with our Q4 results and incredibly proud of the team’s execution on our 2016 strategic plan, particularly given the uniquely eventful past year for Yahoo,” said Mayer in a press release. “What we have achieved reflects some of the most impressive teamwork, focus, and resilience I’ve seen throughout my career. We continued to build our mobile and native businesses—delivering nearly $1.5 billion in mobile revenue and over $750 million in native revenue—while operating the company at the lowest cost structure in a decade. With our 2016 and Q4 financial results ahead of plan, and the continued stability in our user engagement trends, the opportunities ahead with Verizon look bright.”