Todd Davis, the CEO of Lifelock, was a loud leader. His presence was in abundance on every TV show preaching about protective their product was. That is what Lifelock did: protects one from stealing their identity. If something dangerous like that occurs, it alerts the user immediately.
That is a good purpose. Each year, the amount of identity stolen is in the millions. There was a tension which was always present between the consumers and advertisers regarding the product about its potential and operation. “Will it do what they claim it to do?” is the question that lingers.
In the initial stages of Lifelock, Todd wanted to prove his claims were the truth. His strategy to do that walked right into the realm of arrogance.
He put forward a bold campaign idea that would place him and his privacy right on the center. His team suggested against it, telling him it was too risky. However, Todd went ahead with what he intended to do.
What did he do? He mentioned his social security number on one of his ads. He blasted his social security number to create an open world challenge of sorts to all the hackers and frauds alike.
What happened next is not a guess. Well, unfortunately, some hackers accepted the challenge. Todd’s account got hacked 13 times, which included a loan being taken out in his name illegally. That became public. The hackers were triumphant. It was all over new loud and clear, and in turn, it became quite an embarrassment.
However, the embarrassment does not end here. This campaign invited a ton of unwanted attention. The FTC filed a case charging the company for false advertising. After that, 35 state attorneys followed suit, precisely proclaiming Lifelock’s declaration that they virtually guaranteed protection to their audience.
In addition, it was later disclosed that Lifelock’s one million dollar guarantees were filled with caveats. There was an infinite set of fine print. It was going to take years and decades to fully overcome and recover after FTC bombarded Lifelock with million-dollar fines.
It does not end here either. Lifelock was given instructions and restrictions as a settlement for false advertising. What this means is that Lifelock had some years in their hands to get their product to an acceptable standard. Lifelock was left alone after that.
But, they failed to pay their first fine to the government. Because of this, the FTC reopened the investigation and asked Lifelock to pay a $100 million fine. Lifelock could not meet the guidelines either, and this was also a reason why the FTC asked Lifelock to pay the $100 million fine.
Amidst all this hassle, Todd Davis, CEO of Lifelock, resigned from his position. By the way, he did walk away with millions on his hands.
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