Daily Management Review

Hacker attacks on Yahoo! deprived Marissa Mayer of her bonus


03/02/2017


Yahoo! Board of Directors decided to deprive the company’s General Director Marissa Mayer of annual bonus and dismiss the company's legal counsel. Board of Directors explained the decision by the fact that the top managers failed to find a right solution during hacker attacks and theft of user data in 2014, CNBC reported, citing the company's statement.



TechCrunch via flickr
TechCrunch via flickr
General counsel of Yahoo! Ron Bell was dismissed for dereliction of duty, and the company’s CEO Marissa Mayer was deprived of her bonus for 2016 following results of an internal investigation into circumstances of hacking 500 million of client accounts in 2014.

The investigation concluded that the company knew about the hacker attack in 2014, but failed to take necessary steps to study the situation and did not pursue an investigation. Information about the hacker attacks was revealed in September 2016.

Mayer was blamed for failing to notify investors in time. After the scandal, Yahoo! losses exceeded $ 350 million. The main accusation presented to Yahoo! senior leaders is an untimely and sluggish response to a hacker attack. Yahoo! General Counsel Ronald Bell, who also blamed for failing to take timely measures, was dismissed without severance pay.

Back in 2014, top managers and lawyers of Yahoo! knew that a hacker associated with government structures breached in at least a few accounts. Then, 26 users were notified that their account has been compromised, the company also strengthened data protection measures, but the situation has not been studied in depth. It is not clear how widely the information was discussed outside the legal department and the department for cybersecurity. However, there was no deliberate concealment of information about the burglary, the commission concluded.

In February, Yahoo! agreed to lower price of its Internet business to be sold to Verizon, and stopped at $ 350 million because of the scandal over a leak of personal data of 500 million users. In the summer of 2016, the parties agreed to $ 4.83 billion.

Verizon will get Internet business assets of Yahoo! (e-mail, search, news and sports content, financial tools, messenger, AOL internet business purchased by the operator for $ 4.4 billion in the last year). In addition, the agreement includes purchase of real estate owned by the company. Initially, Verizon offered a $ 3 billion, excluding real estate.

Once the transaction is completed (presumably at the beginning of 2017), Yahoo ! will be reorganized into a public investment company, and re-named as Altaba Inc. The company will include stakes in Chinese Alibaba Group (15%) and Yahoo! Japan (35,5%), total amount of nearly $ 40 billion, as well as non-core patents.

The deal was planned to be closed at the beginning of 2017. However, the two scandals related to hacker attacks and theft of user data from Yahoo!, had almost put an end to sale of the company, which has long been looking for ways to save the business.

Yahoo! has undertaken to compensate for 50% of damage that may arise from data leakage. Precisely, this is possible penalties from regulators and potential payment of claims submitted by third parties.

source: fortune.com






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