Chegg to reset passwords for 40 million users after April 2018 hack

Chegg says it discovered the hack last week and that hackers didn't access financial or SSN data.

Chegg, a US-based education technology company based in Santa Clara, plans to reset passwords for over 40 million users following the discovery of a security incident dating back to this year's spring.

The company reported the hack in an 8-K form [1, 2] filed with the Securities and Exchange Commission (SEC) yesterday.

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Chegg said it discovered the hack a week ago, on September 19, but that the intrusion dates back to April 29.

"An unauthorized party gained access to a Company database that hosts user data for chegg.com and certain of the Company's family of brands such as EasyBib," said Chegg in its SEC filing.

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An investigation is currently ongoing. Chegg said the hacker(s) "may have" gained access to user data such as names, email addresses, shipping addresses, Chegg.com usernames, and Chegg.com passwords.

The company said account passwords were protected by a hashing algorithm and were not stored in cleartext, albeit it did not mention which hashing algorithm. This is important as many of these algorithms can be broken and the passwords reverted to their plaintext forms.

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Chegg said hacker(s) did not gain access to Social Security numbers nor financial information, such as payment card or bank account numbers.

The ed tech company said it plans to reset passwords and notify its userbase, estimated at over 40 million.

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Phil Hill, an ed tech consultant who first spotted the SEC form, confirmed that Chegg had not yet started the notification process today, a day after the 8-K filing.

"I get that the company needs to notify the SEC, being a publicly traded company, but they certainly are not notifying the public very well. Seems focus is on guidance for stock price, not transparency," said Hill.

Tech news site TechCrunch first broke the story, noting that Chegg's stock price went down 10 percent after news of the hack hit Wall Street.

Chegg was founded in 2005 and is largely known for its online tutoring and textbook rentals services offered through the chegg.com portal.

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