Big Coral Gables mortgage servicer hit by data breach, exposing clients’ personal information
One of the country’s largest mortgage servicers, a company based in Coral Gables, has reported what appears to be a significant data breach to customers three months after discovering it, prompting two separate federal lawsuits.
In a letter to customers dated March 18, Lakeview Loan Servicing said it had uncovered “a security incident involving unauthorized access to our file servers” in early December. According to the letter, signed by Lakeview senior vice president and chief compliance officer Judith Tribble, internal investigators found that stolen information included names, addresses and Social Security numbers of customers.
The letter, a copy of which a recipient shared with the Miami Herald, does not specify how many customers were affected by the data theft, but Lakeview says on its website that it serves 1.4 million people a year. The website identifies Lakeview, based in Coral Gables and Horsham, Pennsylvania, as the fourth-largest home loan servicer in the country.
One of the two suits filed against the company in Miami federal court put the number of affected Lakeview customers at 2.5 million without providing a source for that number. The suits seek class-action certification on behalf of Lakeview’s affected customers.
In response to a telephone inquiry from a Herald reporter, the company declined to comment on the litigation, but confirmed the 2021 data breach in an emailed statement without providing details. Lakeview said in the statement its business operations were not disrupted.
“Steps were taken to immediately contain the incident, law enforcement was notified, and a thorough investigation was conducted by a forensic investigation firm,” according to the statement. “Lakeview has notified appropriate third-parties and individuals. Additional steps have been undertaken to further enhance existing security measures.”
Lakeview’s internal investigation found that someone had broken into its data storage servers in 2021 during a period lasting from Oct. 27 to Dec. 7, when the breach was discovered and “contained,” according to the letter to affected customers. Lakeview also notified law enforcement. Lakeview generated a list of affected customers on Jan. 31, 2022, and then undertook “extensive measures” to ensure its accuracy, according to the letter.
For some customers, the stolen data also included loan application information and “other items,” according to the letter sent to customers. In general, loan application numbers have been used by perpetrators of mortgage fraud. Lakeview has not specified whether any of its pilfered customer information has been used in any fraudulent activity.
“We regret that this incident occurred and apologize for any inconvenience. Additional steps are being taken to further enhance our security measures,” the letter said.
Less than two weeks after the letter went out, two affected Lakeview customers filed lawsuits in federal court in Miami seeking unspecified compensatory damages and long-term credit-monitoring services paid for by the company. The disclosure letter from Lakeview offers customers one year of free credit monitoring, fraud consultation and identity theft restoration from Kroll, a national consulting firm. Customers with questions can call 855-541-3564.
But the complaints, filed by Massachusetts resident Andrew Guarino and Ohio resident Shannon Thomas, contend that’s not nearly enough, because the breach exposes them to fraud and identify theft for years to come.
The complaints alleged that Lakeview’s data security was inadequate, a point plaintiffs in such cases must demonstrate for the lawsuit to proceed.
Guarino also claimed that Lakeview made the situation worse for customers by waiting to disclose the breach.
“Sitting on this information allowed (Lakeview) to dodge responsibility and inevitably worsened the Data Breach victims’ chances at weathering the storm that (Lakeview) created,” Guarino said in his complaint, filed by Jonathan Cohen, an attorney at the St. Petersburg office of Milberg Coleman Bryson Phillips Grossman, a national firm known for representing consumers in class-action suits.
