It was just 18 months ago when Target Corporation one of the country’s most prolific retailer chains, made national headlines — and not in the way it would have hoped. The company had found itself the victim of a massive data breach at the peak of the 2013 holiday shopping season. The credit cards of over 40 million Target customers were suddenly compromised, placing them at a significant risk of identity theft and leaving the retailer’s reputation in tatters for months afterward. While far from the first major corporate data breach, it did go down as the worst such episode in U.S. retailer history and proved to be a watershed moment that seemed to kick off a string of other high-profile cyber attacks. In the year-and-a-half that followed, other major merchants like Home Depot, P.F. Chang’s and Neiman Marcus all fell victim to hackers in similar incidents, exposing the payment and personal information of millions more Americans.
While Target has struggled to rebuild its reputation with customers and better assure them of payment security going forward, it did take one major step recently in reaching a settlement with Visa Inc. As part of the deal, the retailer will pay out $67 million to the card issuer for costs incurred as a result of the data breach and compromised credit and debit cards. The Wall Street Journal reports that Target is still hashing out a similar deal with MasterCard, though that amount is currently undisclosed.
“This settlement is a step in the right direction, but it still may not make credit unions whole,” said Carrie Hunt, general counsel for the National Association of Federal Credit Unions trade group, in an official statement. As Hunt notes, community bank and credit union trade groups collectively spent over $350 million in the wake of the Target and Home Depot data breaches to reissue credit and debit cards to cardholders.
For its part, Visa said that “this agreement attempts to put this event behind us,” having elicited the maximum allotted payment from Target. The retailer had previously attempted a $19 million settlement with MasterCard, which was rejected. The company could be looking at another $67 million in damages for that deal now.
On the one hand, it’s encouraging to see companies like Target taken to task for allowing their lax security features to give hackers access to millions of unsuspecting shoppers’ credit and debit card information. With the publicity that that incident and others like it have received, more companies are making serious investments into cyber security protocols.
On the other hand, this settlement means little to the consumers who were actually affected by the data breach. A slew of banks and credit unions may be getting reimbursed, but the millions of cardholders whose information was compromised are just as much at risk for ID theft as they were 18 months ago.
This is why it’s so essential to have a credit monitoring services at your disposal. While you can’t always control how third-parties, even reputable ones, may be safeguarding your personal information, you can ensure that you’re at least in the loop if you do end up in an identity thief’s sights. With a credit monitoring service, you can be alerted to certain activity on your credit files that may be evidence of fraud, giving you the time to take more proactive measures to stop identity thieves.