Contact: Tom Crosson, email@example.com, (703) 869-1246
CBA Banks Proactively Replace 15.3 Million Cards in Response to Target Data Breach
Cost of Target’s Mistake: $153 Million…and Counting
Washington, D.C. (January 28, 2014) – The Consumer Bankers Association’s member banks have proactively responded to the breach of consumer data caused by retail giant Target, by reissuing over 15.3 million debit and credit cards to date at a cost to them of over $153 million. In addition to reissuing cards, member banks have enhanced transaction monitoring, added additional fraud rules on accounts, and extended call center operations to respond to consumer inquiries. These services have been provided to consumers at zero cost and are in addition to the stringent requirements banks must safeguard consumer data under the Gramm-Leach-Bliley Act.
Key Facts: Target Data Breach
CBA Member Cards Replaced: 15,390,344
CBA Member Card Replacement Costs: $153,903,440
Target Customers Affected: 110,000,000
Target Customer Cards Compromised: 40,000,000
“CBA member banks take data protection very seriously and have acted swiftly in this matter. Now is the time for Target to step up to the plate and pay the cost where they bear the responsibility,” said Richard Hunt, president and CEO of the Consumer Bankers Association.
According to data collected from CBA member banks, the average cost to replace a physical credit or debit card is no small amount. The cost to replace a card includes: the card itself, informing consumers of a card reissuement, shipping and activating the card, and often supplemental communication (usually via a call center). The total cost to replace each card comes to an average of $10.00. With a total of 15.3 million cards replaced, CBA’s members have spent over $153 million responding to the Target data breach alone. With additional retailers announcing breaches, the banking industry as a whole could see costs swell into the hundreds of millions of dollars, and possibly billions.
“Banks have proactively replaced millions of customers’ cards and allocated significant resources to correct a problem that, by all appearances, was not of their making. This comes at no small cost, and Target needs to take the financial responsibility where they are to blame,” added Hunt.
These numbers do not take into account any fraudulent activity which may have occurred or 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.
The Consumer Bankers Association is the recognized voice on retail banking issues in the nation’s capital. Founded in 1919, CBA provides leadership, education, research and federal representation on retail banking issues. For more information, please contact Tom Crosson, firstname.lastname@example.org, (703) 869-1246 or visit www.consumerbankers.com.