Compensation Options for Victims of the Prosper Data Breach

When a data breach exposes the Social Security numbers of unsuspecting consumers, the consequences are not abstract or temporary. This type of information is permanent.

You cannot change your SSN the way you change a password, and once it is in the wrong hands, the risk can follow you for years.

That reality is at the center of growing concern surrounding the recent Prosper data breach. According to the company’s own disclosures, sensitive personal information, including Social Security numbers and other government-issued identifiers, may have been accessed during unauthorized database queries tied to the incident. 

For many impacted users, this breach could potentially mean a long-term threat to financial security and personal identity.

Below, you can discover more on why Social Security number exposure is so serious, the real-world harms victims may face, and how Morgan & Morgan can help victims fight for the compensation they deserve.

Why Social Security number exposure changes everything

Not all data breaches carry the same level of risk. When email addresses or usernames are compromised, damage can often be limited with password changes, but Social Security numbers are different.

An exposed SSN can be used to:

• Open new credit cards or loans
• Apply for personal or auto loans
• Commit tax fraud and steal refunds
• Access government benefits
• Pass identity verification checks
• Build synthetic identities that go undetected for years

Even if no fraud has occurred yet, victims are often forced into a defensive posture, monitoring credit, freezing accounts, disputing errors, and remaining on alert indefinitely.

That ongoing burden matters legally.

What Prosper users were told about the breach

Prosper has stated that it identified unauthorized access involving queries of databases containing customer and applicant information and later concluded that certain personal data may have been obtained. Among the data elements listed were Social Security numbers, dates of birth, financial account details, and other highly sensitive records.

While Prosper has said there is no evidence of unauthorized access to customer funds, exposure of SSNs alone is enough to create significant risk and measurable harm, especially when paired with other identifying details.

For many affected individuals, the harm is not limited to what has already happened, but what they must now do to protect themselves.

The hidden costs victims often face after SSN exposure

Victims of data breaches involving Social Security numbers frequently experience losses that go far beyond out-of-pocket theft. These include:

Time and productivity loss

Hours or even days can be spent placing credit freezes, contacting financial institutions, disputing fraudulent accounts, and responding to alerts. Courts increasingly recognize this time burden as a real injury.

Ongoing monitoring expenses

Even when companies offer limited free credit monitoring, victims often pay for additional protections long after that coverage ends because the risk does not disappear.

Credit damage

Fraudulent activity can lower credit scores, raise interest rates, and interfere with major life plans like buying a home or car.

Emotional distress and anxiety

Knowing that your most sensitive information is permanently compromised creates persistent stress. Many victims report anxiety every time they receive a credit alert or an unfamiliar letter in the mail.

Increased risk of future fraud

SSNs exposed today may be exploited years later. Criminals often resell data or hold it for later use, making this a long-term problem.

Why companies can be held responsible for SSN data breaches

Companies that collect Social Security numbers take on heightened legal responsibilities. These identifiers are widely recognized as high-risk data, and organizations are expected to implement strong safeguards to protect them.

When a breach occurs, key legal questions often include:

• Were reasonable security measures in place?
• Was sensitive data unnecessarily retained?
• Were access controls properly implemented?
• Did the company act promptly once the breach was discovered?
• Were affected individuals notified in a timely and transparent manner?

If failures in data security or data handling contributed to the exposure, affected users may have grounds to seek compensation.

Compensation options available to Prosper data breach victims

While every case depends on specific facts, victims of SSN exposure may be eligible to seek compensation for a range of harms, including:

Identity theft-related losses

This can include unreimbursed fraudulent charges, costs associated with resolving identity theft, and expenses tied to restoring credit.

Credit monitoring and protection costs

Victims may seek compensation for the cost of credit freezes, identity monitoring services, or fraud protection tools, especially after any complimentary services expire.

Time spent addressing the breach

Courts increasingly recognize time spent responding to data breaches as a compensable injury, particularly when exposure involves Social Security numbers.

Emotional distress

The anxiety and stress caused by knowing your identity is at risk can be factored into damages, depending on the jurisdiction and case structure.

Increased risk of future identity theft

Even in the absence of immediate fraud, the elevated and ongoing risk associated with SSN exposure is being taken more seriously by courts.

In some cases, litigation may also push companies to improve security practices, benefiting not only current victims but future users as well.

Why data breach cases are not “one-size-fits-all”

Many people hesitate to pursue a claim because they believe compensation only applies if money was already stolen. That is not always true, especially when Social Security numbers are involved.

Modern data breach litigation recognizes that:

• The risk itself can be an injury
• Preventive actions cost time and money
• Identity theft may occur months or years later
   

Each claim depends on factors such as:

• The type of data exposed
• Whether mitigation steps were required
• The duration of increased risk
• Any financial or credit impacts experienced

This is why individualized legal review matters.

What to do if your Social Security number was exposed in the Prosper breach

If you received a notice or believe your information was affected, consider taking these steps:

1. Save all breach-related communications
2. Document any time spent responding to the breach
3. Keep records of credit freezes, monitoring services, and related expenses
4. Monitor credit reports and financial statements closely
5. Seek legal guidance to understand your rights

Even if you have not yet experienced fraud, early action can help protect your interests.

How Morgan & Morgan helps data breach victims

Morgan & Morgan has a long history of standing up to large corporations and holding them accountable when consumers are harmed. In data breach cases, that means investigating what data was exposed and how, evaluating whether security failures occurred, identifying compensable harms, and pursuing claims on behalf of affected individuals.

Our firm has the resources to take on complex cases against major companies, and the experience to guide clients through what can be a confusing and stressful process.

When a company collects your Social Security number, it assumes a responsibility to protect it. If that information is exposed, the consequences should not fall solely on you.

If your SSN was involved in the Prosper data breach, you may have options to seek compensation for the risks, costs, and disruptions you now face. Speaking with an attorney at Morgan & Morgan can help you understand those options and decide what steps make sense for your situation.

If you were impacted by the Prosper data breach, contact Morgan & Morgan for a free case evaluation to learn more about your rights and potential next steps.