T-Mobile US, Inc. (TMUS) has been slapped with a hefty $60 million fine by the Committee on Foreign Investment in the U.S. (CFIUS). This penalty, the largest ever levied on the company, arises from its failure to adequately prevent and report unauthorized access to sensitive data. The issue stems from violations of a security agreement T-Mobile entered into during its $23 billion acquisition of Sprint Corp in 2020.
According to U.S. officials, T-Mobile, majority-owned by Deutsche Telekom, experienced unauthorized access to sensitive data in both 2020 and 2021. The company attributed these breaches to technical issues encountered during its post-merger integration with Sprint, which impacted the sharing of information from a limited number of law enforcement requests. T-Mobile emphasized that the data remained within the law enforcement community, was reported promptly, and was quickly addressed.
However, CFIUS officials expressed concern about T-Mobile’s failure to report these incidents promptly. The delay hindered CFIUS’ ability to investigate and mitigate any potential harm to U.S. national security. This hefty fine serves as a strong reminder of CFIUS’ commitment to holding companies accountable for their security responsibilities.
Investors interested in the company’s stock performance can consider the Simplify Next Intangible Value Index ETF (NXTV) and the Invesco BuyBack Achievers ETF (PKW) for exposure. TMUS shares closed down 0.72% at $193.92 in premarket trading on Wednesday.
This news underscores the critical importance of robust data security measures and prompt reporting of breaches to protect sensitive information and national security. Companies must prioritize these aspects to avoid similar penalties and maintain public trust.
