How the Prosper Data Breach Happened and Who Qualifies for a Claim

As more details emerge about the Prosper data breach, one question continues to surface among impacted users: How did this happen, and do I qualify to take legal action?

For many consumers, a breach notice arrives with little explanation and even less clarity about next steps. Companies often describe incidents in technical language, emphasize what wasn’t affected, and offer short-term monitoring, while leaving individuals to shoulder long-term risk.

Let’s now take a look at how the breach reportedly occurred, what makes this incident different from routine cyber events, and who may qualify to pursue a claim based on the exposure of their personal information.

What Prosper has disclosed about how the breach occurred

According to Prosper’s public disclosures, the company discovered unauthorized activity involving its systems in early September 2025. After detecting the activity, Prosper states that it took steps to contain the incident, engaged outside cybersecurity experts, and notified law enforcement.

Crucially, Prosper later determined that unauthorized queries were run against databases containing customer and applicant information during a period spanning June through August 2025. In other words, the issue was not a brief intrusion; it involved repeated or sustained access to internal data repositories over time.

This distinction matters.

Breaches involving database queries often raise serious questions about:

• Access controls
• Monitoring and alert systems
• Privilege management
• Whether sensitive data was adequately segmented or encrypted

When attackers can query databases holding Social Security numbers, financial information, and identity documents, it may indicate deeper security gaps than a one-time system glitch.

Why “database query” breaches are especially concerning

Unlike breaches caused by a lost laptop or a single compromised password, database query incidents can allow threat actors to extract large volumes of structured data quietly.

These types of breaches may involve:

• Compromised credentials with excessive permissions
• Inadequate logging or delayed detection
• Failure to flag abnormal query behavior
• Poor separation between production systems and sensitive data stores

If unauthorized access persists for weeks or months, the potential scope of exposure increases, and so does the likelihood that sensitive information was copied, exfiltrated, or later resold.

For impacted individuals, the result is the same: once the data is accessed, control is lost.

What types of data exposure matter for legal claims

Prosper has stated that impacted data may include combinations of highly sensitive personal information, such as:

• Social Security numbers
• Dates of birth
• Bank account numbers
• Financial or credit application data
• Driver’s license or passport numbers
• Tax-related information

From a legal perspective, the type of data exposed is critical. Courts and regulators consistently treat Social Security numbers, government IDs, and financial data as “high-risk” information because misuse can cause lasting harm.

You do not need to experience immediate financial theft for exposure of this kind of data to be legally significant.

Do you qualify for a Prosper data breach claim?

You may qualify to pursue a claim related to the Prosper data breach if any of the following apply:

You received a breach notification

If Prosper sent you a letter or email stating that your personal information may have been involved, that alone may be enough to establish eligibility for review.

You were a Prosper customer or applicant during the affected period

Prosper’s disclosures reference customer and applicant databases. Even if you did not ultimately take out a loan, submitting personal or financial information could place you within the impacted group.

Your Social Security number or financial data was exposed

Exposure of SSNs, bank account numbers, or government-issued IDs significantly strengthens potential claims due to the elevated risk of identity theft.

You took steps to protect yourself after the breach

Time spent placing credit freezes, monitoring accounts, changing passwords, or dealing with fraud alerts can constitute measurable harm.

You are experiencing suspicious activity

Unauthorized credit inquiries, unfamiliar accounts, tax issues, or phishing attempts tied to your personal details may further support a claim, but they are not required to qualify.

A common misconception: “Nothing bad has happened yet”

One of the most common reasons people delay action after a data breach is the belief that they must wait until money is stolen.

That belief is outdated.

Modern data breach cases increasingly recognize that exposure itself creates harm and that victims are forced to spend time and money to mitigate risk. Social Security numbers cannot be replaced, and the risk of future identity theft is ongoing and measurable.

In fact, many identity theft cases occur months or years after a breach, when victims are no longer actively monitoring their credit.

Waiting does not reduce risk, and it often increases it.

What factors determine the strength of a data breach claim

Not every breach leads to the same legal outcome. Claims are evaluated based on several factors, including:

• The sensitivity of the data exposed
• How long unauthorized access lasted
• Whether reasonable security safeguards were in place
• The clarity and timing of consumer notifications
• The real-world burden placed on impacted individuals

In breaches involving prolonged database access and high-risk identifiers, these factors tend to weigh more heavily in favor of affected consumers.

Why Prosper’s role matters

Companies that collect financial and identity data benefit from consumer trust, and they are expected to invest accordingly in data protection.

When a company retains sensitive information long-term, allows broad database access, and/or fails to detect unusual activity promptly, it may be exposed to legal scrutiny over whether reasonable steps were taken to protect that data.

Consumers do not choose to bear this risk alone. It is imposed when personal information is required as part of a financial transaction or application.

What to do if you believe you qualify for a claim

If you think your information may have been involved in the Prosper data breach, consider taking the following steps:

1. Keep copies of all breach notices and related communications
2. Document the steps you’ve taken to protect your identity
3. Save records of time spent addressing the breach
4. Monitor your credit and financial accounts
5. Seek legal guidance to understand your options

You do not need to navigate this process on your own or guess whether your experience “counts.”

How Morgan & Morgan evaluates Prosper data breach claims

Morgan & Morgan has extensive experience handling large-scale consumer cases involving corporate misconduct and data security failures.

In data breach matters, our attorneys focus on how the breach occurred and work diligently to determine what data was exposed, while determining who qualifies for relief.

For over 35 years at Morgan & Morgan, we have fought For the People, holding companies accountable for preventable failures. We know that behind every breach notice is a real person dealing with uncertainty, inconvenience, and risk.

The Prosper data breach involved the exposure of deeply personal information and created lasting consequences for the people whose data was entrusted to the company.

If you were affected, you have the right to ask how this happened and whether you qualify to pursue a claim. Understanding your options is the first step toward protecting yourself and seeking accountability.

If you believe your information was exposed in the Prosper data breach, Morgan & Morgan can help you evaluate your eligibility and explain potential next steps. Contact us today for a free case evaluation.