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Ashley Madison will pay $11.2 million to users for data breach

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Ashley Madison

While the above incidents are quite tragic, it appears that problems for Ashley Madison aren't quite over.

If combined claims exceed the settlement monetary pie, funds "will be allocated on a pro-rata basis based on each claim's recognized loss as compared to all recognized losses for all claims", according to the deal. The company paid $1.6 million last December to settle an FTC probe into its lax security and deceptive practices - millions of "female" accounts on the site were actually bots operated by Ashley Madison. The settlement requires approval by a federal judge. It claims that the account credentials were not verified for accuracy and some may have been created using other individuals' information.

Now rebranded as Ruby Corp., the company will pay the proposed amount as a settlement for the class action lawsuits filed against them after an online hacker exposed the personal data of over 37 million users of the website, AshleyMadison.com, which operates as an online dating service for people who are married or in committed relationships.

"The parties have agreed to the proposed settlement in order to avoid the uncertainty, expense, and inconvenience associated with continued litigation, and believe that the proposed settlement agreement is in the best interest of Ruby and its customers", the firm said in a statement.

Before the hack put Ashley Madison under worldwide scrutiny, the company was dogged by allegations that it resorted to fake profiles of women or so-called bots to lure unsuspecting male customers. Ruby also spent millions of dollars to bolster its security and improve user privacy.

Ashley Madison is to pay a sum of $11.2 million (roughly £8 million) to their clients who were victims of a major hacking attack. The settlement said the owners of the Ashley Madison site, which is still active, have added new security measures to the website.

The lawsuits, consolidated in the United States District Court for the Eastern District of Missouri, will be dropped should the courts agree to the settlement.

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