MGM Challenges FTC Probe Into 2023 Cyberattack

MGM Resorts International (MGM) has filed a lawsuit against the Federal Trade Commission (FTC) and its Chair, Lina Khan, challenging the regulator's probe into a cyberattack that targeted the casino operator in September.

MGM states that it falls outside the scope of the FTC's regulations regarding consumer financial data. (Source: Photo by David Vives on Unsplash)

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In the lawsuit that was lodged in the U.S. District Court for the District of Columbia, MGM alleged that the FTC infringed upon its Fifth Amendment rights of due process and equal treatment under the law.

MGM asserted that as a non-financial institution, it falls outside the scope of the FTC's regulations regarding consumer financial data.

MGM Alleges Khan’s Involvement in FTC Probe

Furthermore, the operator contended that the FTC launched the investigation because Khan happened to be a guest at one of MGM's Las Vegas properties during the attack. Due to system failures at that time, Khan was asked to write down her credit card details, which prompted her to question MGM's data security protocols during the outage. The desk clerk who attended to her could not verify or ease her concerns.

Subsequently, on January 25, the FTC issued a Civil Investigative Demand (CID) in response to Khan's unanswered inquiry. MGM highlighted that the FTC referenced two financial services regulations to justify the investigation, both of which, according to the company, do not apply to its operations.

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$100M Loss from Cyberattack

In October 2023, a month after the hack, MGM announced that the incident led to it incurring an estimated $100 million loss.

During the cyber attack, MGM suspended its operational systems to limit the potential harm inflicted by the intrusion. The company refused the cyber attackers' ransom demands to regain control over their systems and consequently remained compromised and lost operations for a significant number of days.

MGM stated that the hackers were unsuccessful in acquiring any financial information of their customers, such as bank account details or payment card data. It also confirmed that no data from the Cosmopolitan of Las Vegas was compromised.

The hack also led to a series of class-action lawsuits against MGM in the Nevada District Court.


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