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Data leaks cost firm $6m

Sends warning to all firms about importance of data protection...

By Joris Evers

Published: 21 July 2005 07:40 BST

Data broker ChoicePoint took a $6m charge in its second quarter to cover costs related to the leak of information on about 145,000 US citizens, it said on Wednesday.

The charge is in addition to the $5.4m in costs the company recorded in the first quarter. Of the total $11.4m, about $2m in charges through 30 June were for communications to individuals whose data has been exposed as well as credit reports and monitoring services for those people, the company said in a statement.

The remaining $9.4m was for legal and other professional fees, ChoicePoint said.

ChoicePoint revealed in February that scam artists had gained access to personal data on tens of thousands of Americans, resulting in at least 750 cases of identity theft. The scandal has prompted calls for new legislation to protect consumers' privacy rights.

Joris Evers writes for News.com

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