April 15, 2015

NAFCU monitors $19M Target settlement

NAFCU President and CEO Dan Berger expressed appreciation that a settlement involving as much as $19 million has been reached between Target and MasterCard Inc. in the wake of Target's massive data breach bus said the settlement, if finalized, represents "just pennies on the dollar."

The two companies announced their deal Wednesday following months of discussion. Under the agreement, Target will make available "up to $19 million in alternative recovery offers to eligible banks and credit unions across the globe." The settlement is contingent on, among other things, issuers representing at least 90 percent of the eligible MasterCard accounts accepting their alternative recovery offers, either directly or through their sponsoring issuers, by May 20.

"NAFCU has been in regular contact with MasterCard and VISA on data breaches as well as other payment issues," Berger said Wednesday. "While we appreciate that the settlement attempts to hold Target somewhat accountable, we were hoping it would be more than just pennies on the dollar. We believe that this demonstrates the reason why Congress must act to protect consumers' financial information by enacting stronger standards and holding retailers and merchants directly accountable for their data breaches."

The House Small Business Committee announced yesterday that Berger would testify on NAFCU's data security principles and how credit unions have successfully minimized data breaches during a hearing next week. NAFCU continues to seek passage of a data security bill that would create a strong national standard of protection for retailers, recognize credit unions' compliance with the Gramm-Leach-Bliley Act and hold retailers accountable for breaches occurring on their end.