T-Mobile US has agreed to pay about $550 million to end a lawsuit against it and improve its security.
The class-action lawsuit began after it was revealed that hackers penetrated the company's infrastructure last summer and collected personal data belonging to nearly 77 million of its customers.
The mobile network operator (with 2021 net income: 3 billions of dollars) agreed to pay $350 million to cover legal fees and settle a class-action lawsuit brought by customers whose data was breached in August 2021, according to documents filed with the U.S. Securities and Exchange Commission (or SEC) on Friday.
That payment will be distributed to 76,6 million U.S. residents, according to the proposed settlement agreement [PDF], which is subject to approval by a district court judge. That will be less than five dollars each if they all claim their money, and a large portion of the money will go to the lawyers involved.
It's worth noting that the number of customers affected by the security breach is much higher than the company admitted last year. While the hackers claimed to have stolen data belonging to 100 million (names, addresses, Social Security numbers and information from driver's licenses) – T-Mo executives at the time admitted to the leak for 48 million customers alone.
After extracting the customer data, the hackers they made available data on 30 million of the company's customers in an underground forum for $280.000 while they say they sold the rest privately.
In addition to paying back millions of customers to settle the class action, as well as settling other separate claims, the carrier will also spend $150 million on “security technology” for 2022 and 2023.
That brings the total to about $550 million by the end of 2023, according to SEC filings.