Flagstar Bank Faces Class Action Lawsuit Over Data Breach

Flagstar Bank is facing a class action lawsuit over a data breach that exposed sensitive customer information. The lawsuit alleges that the bank failed to protect customers' data, putting them at risk of identity theft and other financial harm.

The data breach is believed to have occurred in 2020, and it's reported that over 1.5 million customers had their information compromised. This includes Social Security numbers, addresses, and other personal details.

Flagstar Bank has acknowledged the breach, but the company's response has been criticized by some as inadequate. The bank has offered affected customers credit monitoring and identity theft protection, but some argue that this isn't enough to mitigate the damage.

Flagstar Bank was hit with a $3.6 million fine for misleading customers and investors about a cyberattack that compromised the personal information of 1.5 million people.

The cyberattack occurred between November 22 and December 25, 2021, and the bank made a ransom payment of $1 million worth of bitcoin to the hackers.

Flagstar Bank's CEO and president at the time, Thomas R. Cangemi, resigned due to the fallout from the cyberattack.

A cash infusion of $1.1 billion from an investors' group led by Steven Mnuchin helped the bank stabilize after the cyberattack.

The bank has since replaced most of its top management and sold its mortgage servicing and third-party loan origination units.

Flagstar Bank is facing a proposed class action lawsuit over the 2021 data breach, which allegedly exposed the personal information of 1,547,169 current and former customers.

The lawsuit claims that the bank took more than six months to discover the breach and notify those affected, leaving them exposed to identity theft and fraud.

Flagstar Bank offered 24 months of free credit monitoring and identity repair services to affected customers, but the lawsuit argues that this is inadequate to protect them from the long-term implications of the data breach.

The lawsuit seeks to provide enough money to pay for identity theft protection services for victims' respective lifetimes.

A securities class action lawsuit was filed against Flagstar Bank in connection with the sale of mortgage-backed securities. The lawsuit alleges that Flagstar Bank misled investors about the quality of the securities.

The lawsuit specifically targets Flagstar Bank's sale of residential mortgage-backed securities (RMBS) between 2006 and 2007. Flagstar Bank allegedly failed to disclose the true risks associated with the securities.

The plaintiffs in the lawsuit claim that Flagstar Bank engaged in a scheme to deceive investors about the quality of the securities. They allege that the bank misrepresented the creditworthiness of the borrowers and the value of the underlying properties.

Flagstar Bank allegedly sold the securities to investors at inflated prices, resulting in significant losses when the securities defaulted. The lawsuit seeks damages on behalf of the investors who purchased the securities.