Target reaches $19 million settlement with MasterCard to resolve breach
Published Apr 15, 2015 07:10PM ET
Updated Apr 15, 2015 08:01PM ET
Target and MasterCard agreed on a settlement Wednesday, stemming from a massive 2013 breach
Investing.com -- Target Corporation (NYSE:TGT) announced on Wednesday that it has entered into a settlement agreement with Mastercard Incorporated (NYSE:MA) to resolve claims related to a data breach that compromised at least 40 million accounts during the 2013 holiday season and an additional 70 million accounts in what amounted to the largest cryptographic attack on a retail chain ever.
Under the agreement, Target will pay up to $19 million to eligible banks and credit unions that issued MasterCard-branded that were impacted by the breach. On November 27, 2013, two days before Black Friday, Target was exposed to a massive malware attack that went undetected for six days. By Dec. 19, Target announced that at least 40 million accounts were compromised during the three-week period.One day later, Target issued a public apology by offering customers a 10% discount on all Christmas purchases.
Last July, more than 65 class action lawsuits were consolidated against the retailer in U.S. District Court of Minnesota. At that point, former Target CIO Beth Jacob and CEO Gregg Steinhafel had already announced their resignations from the company.
The settlement stipulates that at least 90% of the issuers representing MasterCard accept the recovery offers from Target by May 20.
“We are hopeful that Target’s agreement to pay up to $19 million to settle the claims of MasterCard and its issuers will result in a high level of issuer acceptance," Scott Kennedy, President, Financial & Retail Services at Target said in a statement. "Target intends to continue to defend itself vigorously against any assessments made by MasterCard on behalf of MasterCard issuers that do not accept their offers.”
If the settlement is accepted, issuers will be paid by the end of the second quarter of 2015, MasterCard said in a statement.
“We believe this settlement provides our issuers a reasonable resolution of the Target data breach event,” MasterCard chief franchise integrity officer Eileen Simon said in a statement. “The timely reimbursement of costs and losses under the agreement delivers MasterCard issuers a faster and more certain resolution to the event, while reinforcing our commitment to maintain the integrity of industry security standards.”
Get The News You Want
Written By: Investing.com
Trading in financial instruments and/or cryptocurrencies involves high risks including the risk of losing some, or all, of your investment amount, and may not be suitable for all investors. Prices of cryptocurrencies are extremely volatile and may be affected by external factors such as financial, regulatory or political events. Trading on margin increases the financial risks.
Before deciding to trade in financial instrument or cryptocurrencies you should be fully informed of the risks and costs associated with trading the financial markets, carefully consider your investment objectives, level of experience, and risk appetite, and seek professional advice where needed.
Fusion Media would like to remind you that the data contained in this website is not necessarily real-time nor accurate. The data and prices on the website are not necessarily provided by any market or exchange, but may be provided by market makers, and so prices may not be accurate and may differ from the actual price at any given market, meaning prices are indicative and not appropriate for trading purposes. Fusion Media and any provider of the data contained in this website will not accept liability for any loss or damage as a result of your trading, or your reliance on the information contained within this website.
It is prohibited to use, store, reproduce, display, modify, transmit or distribute the data contained in this website without the explicit prior written permission of Fusion Media and/or the data provider. All intellectual property rights are reserved by the providers and/or the exchange providing the data contained in this website.
Fusion Media may be compensated by the advertisers that appear on the website, based on your interaction with the advertisements or advertisers.