Democratic senators led by presidential candidate Sen. Elizabeth Warren, a Massachusetts Democrat, and Sen. Ron Wyden, an Oregon Democrat, said in a Thursday letter that Amazon.com, Inc. (NASDAQ: AMZN)'s failure to protect a major financial customer led to an enormous data breach The Wall Street Journal reported.
The senators said the e-commerce giant failed to take steps to fix a known security issue in its cloud business.
As a result, one of Amazon's clients, Capital One Financial Corp. (NYSE: COF), suffered a data breach that resulted in the theft of personal information of more than 100 million cardholders and applicants.
According to the letter, Amazon's weakness and vulnerability was known a year earlier.
As a result, the Federal Trade Commission should investigate Amazon and determine if its missteps constitutes an "unfair business practice" in violation of federal regulations, Warren and Wyden said.
Amazon and the FTC didn't respond to WSJ's request for comment, while Capital One told the publication it has no comment.
Why It's Important
Financial institutions are opting to store customer information on cloud platforms instead of traditional data centers, according to WSJ.
This poses a new set of security challenges that are not properly understood by the financial industry.
Two Democratic House members urged Treasury Secretary Steven Mnuchin to explore whether cloud service providers should be considered a systemically important financial-market utility provider, according to WSJ.
If the Trump administration were to move in this direction, it would be result in new and further oversight on how data is stored.
Amazon shares were up 0.72% at $1,774.80 at the time of publication, while Capital One shares were down 1.19% at $91.69.
The Lesson From The Capital One Data Breach: The Cloud Is Vulnerable, And We Shouldn't Forget It
Report: Capital One Cyberbreach A Result Of High Turnover
See more from Benzinga
- Cramer: Is FAAMG The New FAANG?
- Amazon's Latest Acquisition Meant To Help Merchants Import Items
- Chart Pro On Microsoft: 'Watch Out' If Stock Hits 5
© 2019 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.