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FTC Orders Chegg to Improve Security After Four Data Breaches

The FTC’s final 2023 order followed four alleged breaches and required Chegg to strengthen security, limit personal data, offer authentication options, and provide customer access and deletion requests.
From TheFinanceBase Team3 min to read
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The Federal Trade Commission’s final order, announced January 26, 2023, requires Chegg to strengthen its information-security program, collect and retain less personal data, offer multifactor authentication or another authentication method, and let customers access or request deletion of information the company holds about them. The order followed an FTC complaint describing four breaches between 2017 and 2020; the alleged failures and the remedies are distinct from the FTC’s separate 2025 case over cancellation practices.

What did the FTC order Chegg to do?

The FTC’s finalized order requires Chegg to:

  • Maintain a comprehensive information-security program.
  • Document what personal information it collects, why it collects it, and when it will delete it, then follow those policies.
  • Offer customers and employees multifactor authentication or another authentication method.
  • Give customers access to information Chegg collected about them and a way to request its deletion.

These requirements address both company safeguards and customers’ control over their data. The order does not endorse a particular security product or require a particular kind of authenticator.

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Does the order require two-factor authentication?

It requires Chegg to offer multifactor authentication or another authentication method to customers and employees. Multifactor authentication uses an additional credential beyond a password or PIN. The FTC’s consumer guidance gives examples such as a security key, a code sent by text or email, or an authenticator app; those examples explain MFA generally and are not specific tools mandated by the order. See the FTC’s data-breach and MFA explainer.

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How many breaches did the FTC describe, and what information was exposed?

The FTC described four incidents from 2017 through 2020. Its January 2023 announcement said the breaches exposed personal information associated with about 40 million users and employees. That is the FTC’s estimate of records exposed, not a count of people confirmed to have suffered identity theft or fraud.

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Period FTC’s account Information described
September 2017 A phishing attack targeting employees. Employee direct-deposit information.
2018 A former contractor allegedly used shared login information to access a third-party cloud database associated with approximately 40 million customers. Names, email addresses, and passwords; for some users, sensitive information related to scholarship searches.
2019–2020 Two further phishing incidents affecting employees. Sensitive employee information, including financial or medical information.

The FTC’s descriptions do not mean every affected person had every listed data field exposed. The agency’s final-order announcement and initial announcement summarize the incidents and data categories.

What security failures did the FTC allege?

In its administrative complaint, the FTC alleged that Chegg’s practices left information vulnerable. The allegations included storing some sensitive information in plain text, using weak password encryption through at least 2018, inadequate access controls and monitoring, and insufficient security policies and employee training. These are allegations in the complaint, not a judicial finding that every alleged fact was proven.

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The FTC announced the complaint and proposed consent order on October 31, 2022, then finalized the order on January 26, 2023. A final consent order is binding as to future conduct; the FTC’s initial announcement describes the agency’s administrative process and states that a final consent order “carries the force of law with respect to future actions.” That procedural effect should not be confused with a court judgment resolving each complaint allegation.

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What happened after the 2023 security order?

In September 2025, the FTC announced a separate action concerning Chegg’s subscription-cancellation practices and referred to the earlier security order as a prior order. It was not an amendment to the 2023 data-security requirements. The FTC’s 2025 case page was updated September 19, 2025 and listed that later matter as pending at that time; its status may have changed since. The separate announcement is available at the FTC’s cancellation case release.

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Sources and case record

The FTC’s Chegg case page collects the agency record. The complaint is available as a PDF. The final order announcement is the source for the order’s requirements and the FTC’s about-40-million estimate; the 2022 announcement and complaint describe the agency’s allegations.

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