In what could be the second largest credit and debit card
breach, specialty retailer
) acknowledged that security of nearly 40 million credit and
debit accounts of its customers were compromised. Though the
company did not disclose how the lapse occurred, it assured it
was taking help of federal law enforcement and external experts
to tighten the security to avoid similar frauds, going forward.
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According to Target, the hacking took place during the ongoing
holiday season - from a day before Thanksgiving up to Dec 15. A
source familiar with the investigation authorities claimed that
the company was alerted by credit card processors who detected an
increase in dubious transactions pertaining to cards used at
The credit and debit card security breach of Target's consumers
could result in loss of millions of dollars. However, lawyers and
other experts on the matter remain tight-lipped as to who is
likely to bear the expense.
In 2007, the biggest security breach in U.S history was detected
The TJX Companies, Inc.
) - a leading off-price retailer of apparel and home fashions
-reported data theft involving nearly 90 million credit and debit
cards over a span of about one and a half years beginning Jul
2005 to Dec 2006. In 2009, TJX Companies agreed to shell out
$9.75 million in settlement with several states.
Ever since, companies like
Wal-Mart Stores Inc.
) as well as Target have been deploying substantial cash to
tighten security. It is quite surprising that hackers could
breach the security at Target in spite of the company's
safeguards. Target has asked its customers to report any
discrepancy in their card statements either to the company or to
the Federal Trade Commission or the Credit card Company.
Irate consumers have taken to social media whereas a
California-based customer filed a lawsuit against Target seeking
damages for the cyber breach. Lawyers believe that Target could
be slapped with more litigation charges in the coming days.
Though public memory tends to be short lived, the scandal could
mar the retailer's performance in the crucial holiday season.
Target is the second largest discounter and operates 1,797 stores
in the U.S. It currently carries a Zacks Rank #3 (Hold). Another
better-ranked retail stock is
) with a Zacks Rank #2 (Buy).