LoanDepot class action alleges company failed to prevent massive data breach

LoanDepot class action lawsuit overview:

• Who: Plaintiff Jonathan Rosa filed a class action lawsuit against LoanDepot Inc.
• Why: LoanDepot allegedly failed to adequately protect sensitive personal information, leaving it vulnerable to a data breach that affected millions of its customers.
• Where: The LoanDepot class action lawsuit was filed in California federal court.

Mortgage lender LoanDepot Inc. is facing a class action lawsuit alleging its “willful failure” to prevent a data breach enabled unauthorized third parties to access more than 16 million consumers’ sensitive personal information.

LoanDepot reported the data breach Jan. 8 in a form 8-K filing with the U.S. Securities and Exchange Commission. The company announced the LoanDepot data breach on its website the same day, according to the LoanDepot class action lawsuit.

Plaintiff Jonathan Rosa says he provided personally identifying information (PII) including his name, Social Security number, birthdate, bank account numbers and other sensitive information to LoanDepot when he applied for a personal loan in 2021.

As a result of the LoanDepot data breach, he says he will be at substantial risk of identity theft and fraud.

Rosa says he paid a premium to LoanDepot for its data security and claims he would not have used LoanDepot had he known the company would expose his sensitive PII.

“In its Privacy Policy, LoanDepot makes numerous promises to its customers that it will maintain the security and privacy of their personal information,” the class action lawsuit alleges.

Plaintiff: LoanDepot data breach victims face threat of identity theft, fraud

The class action lawsuit explains PII is highly valuable to cyber criminals because the data can be used to commit identity theft, fraud and other criminal activities.

“Given the nature of the [LoanDepot data breach], it is foreseeable that the compromised PII will be used to access plaintiff and the class members’ financial accounts,” the class action lawsuit says.

It is possible that the LoanDepot data breach victims may not fully experience the effects of their data being stolen for years to come, Rosa says.

The class action lawsuit asserts claims for negligence, breach of contract, violation of the California Consumers Legal Remedies Act, Unfair Competition Law, Customer Record Act and unjust enrichment.

A LoanDepot class action lawsuit filed last year alleged the mortgage lender’s website recorded visitors’ keystrokes and website interactions in violation of consumer privacy laws.

Were you affected by the LoanDepot data breach? Tell us about your experience in the comments.

Rosa is represented by Daniel S. Robinson and Michael W. Olson of Robinson Calcagnie Inc. and Stephen R. Basser and Samuel M. Ward of Barrack Rodos & Bacine.

The LoanDepot class action lawsuit is Jonathan Rosa v. LoanDepot Inc., Case No. 8:24-cv-00167, in the U.S District Court for the Central District of California.

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