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In the FT’s San Francisco office, we call it Uber Tuesdays. Scandals relating to the ride-hailing app always seem to reveal themselves on Tuesdays. And this year, Uber has been dogged by serious problems: from sexual harassment cases to an intellectual property lawsuit from Google’s Waymo.
These problems forced co-founder Travis Kalanick from the top job, after a long tussle with the board. The new chief executive, Dara Khosrowshahi, has been fighting to repair Uber’s reputation and secure new funding from Softbank – but it turns out there was still at least one skeleton in its closet.
Uber said on Tuesday that it had failed to tell users or regulators about a data breach in 2016 where personal information of 50m users and 7m drivers were stolen. This cover-up has already attracted ire from regulators around the world who believe companies need to act speedily so consumers know their data has been lost.
Most strikingly, Uber said it paid hackers $100,000 to delete the data and not talk about the hack. This is highly unusual and frowned upon by law enforcement. With the recent rise in ransomware, some companies have been paying ransoms to decrypt their files – but for far less money. Just like paying a ransom to a kidnapper risks encouraging more kidnaps, paying hackers could entice more hacks. There is also no way of checking the hackers actually deleted the data.
There are many questions left to answer: how much did Travis Kalanick know? How much could Uber face in fines? Will the FBI investigate? The FT will be pursuing the story.
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