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1.6 million affected by data breach at platform acquired by PayPal

Brian C. Rittmeyer
| Wednesday, Dec. 6, 2017, 10:57 a.m.

A data breach at PayPal has compromised the bank account information and social security numbers of 1.6 million users in the United States and Canada.

The Pennsylvania Office of Attorney General's Bureau of Consumer Protection said PayPal contacted it about the breach.

According to the Attorney General's office, the breach happened on TIO Networks in July, before PayPal bought the company. TIO suspended operations in November after discovering the breach.

PayPal told the Bureau of Consumer Protection that hackers may have obtained names, addresses, bank account information, social security numbers and login details of 1.6 million TIO users.

TIO Networks, formerly a Canadian-based payment firm, made digital bill payment tools for utilities and operated a network of kiosks in retail stores. Many of the consumers who used TIO's payment methods were lower-income consumers, according to the Attorney General's office.

Attorney General Josh Shapiro said PayPal is working with state officials to protect consumers.

PayPal said it has reached out to billers to obtain addresses for potentially affected consumers, and expects to mail notices to them soon. The company said free credit monitoring will be provided to those affected by the breach.

“We appreciate Attorney General Shapiro's recognition of PayPal's proactive efforts to address the TIO Networks situation,” PayPal spokesman Justin Higgs said in response to a request for comment. “We will continue to put customers first, and to work cooperatively with regulators, officials and our billing partners throughout this process.”

Shapiro noted that PayPal's actions are in stark contrast to how credit monitoring service Equifax responded to a breach impacting at least 145 million people, including 5.5 million Pennsylvania residents, earlier this year.

“They knew of a potential problem in March, and specifically learned of the breach in July — yet alerted no one until September,” a news release from the Attorney General's office says.

Shapiro has demanded that Equifax disclose exactly when it learned of the breach and what it did about it. Equifax eventually relented to demands from Shapiro and others to offer free credit monitoring to affected consumers.

In the PayPal case, the Bureau of Consumer Protection is demanding to know the exact date PayPal discovered the hack, the number of affected users in Pennsylvania and nationwide, and the specific kinds of information and data that were compromised.

“We want Pennsylvanians who believe they've been affected by this latest breach or the other breaches to file complaints with us,” Shapiro said. “Our goal is to force change in corporate behavior, so companies entrusted with our most secure information take substantive steps and implement the best technology to safeguard it better in the future.”

Brian C. Rittmeyer is a Tribune-Review staff writer. Reach him at 724-226-4701, or via Twitter @BCRittmeyer.

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