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Cost of Target Data Breach Exceeds $200 Million
Washington, D.C. (February 18, 2014) – Financial institutions continue to respond to the massive data breach at Target. According to data collected by the Consumer Bankers Association (CBA) and the Credit Union National Association the costs associated with the Target data breech exceed $200 million. CBA estimates the cost of card replacements for its members to have reached $172 million, up from an initial finding of $153 million, CUNA has stated the cost to credit unions has increased to $30.6 million from an original estimate of $25 million.
So far, cards replaced by CBA members and credit unions account for more than half of all affected cards. Between members of the Consumer Bankers Association (CBA) and the Credit Union National Association (CUNA), 21.8 million of the 40 million compromised cards have been replaced. This represents 54.5 percent of the cards Target has revealed to have been compromised due to the December data breach.
“Financial institutions of all sizes have been aggressive in ensuring their customers are protected in response to the Target data breach. CBA’s members have proactively replaced cards, increased fraud monitoring efforts and have expanded call center hours. Consumers should rest assured, our members are taking every step to minimize the impact of this massive breach,” said Richard Hunt, president and CEO of the CBA.
“Credit unions have replaced or will replace 85% of their cards affected by the Target breach at no cost to their members,” said Bill Cheney, president and CEO of CUNA. “The combined $200 million cost borne entirely by banks and credit unions shows the extent to which financial institutions will go to protect their customers and members.”
The combined $200 million cost does not factor in costs to financial institutions other than credit unions or members of the CBA, nor does it take into account any fraudulent activity which may have occurred or may occur in the future. Fraudulent activity would push the cost of the Target data breach to the industry much higher, as consumers would not be held liable.
The Consumer Bankers Association (CBA) is the trade association for today's leaders in retail banking - banking services geared toward consumers and small businesses. The nation's largest financial institutions, as well as many regional banks, are CBA corporate members, collectively holding two-thirds of the industry's total assets. CBA’s mission is to preserve and promote the retail banking industry as it strives to fulfill the financial needs of the American consumer and small business.