agreed to pay $9.75 million to 41 states to settle an investigation of a
massive data breach that jeopardized millions of payment card numbers. The parent
of T.J. Maxx and Marshalls will pay $7.25 million in settlement and
investigation costs. In addition, $2.5 million will go to create a data
security fund for those states.
In
January 2007, TJX disclosed that hackers had tapped into its computer systems,
which stored about 50 million customers' credit and debit card numbers. The
breach wasn't detected for more than a year.
TJX emphasized
in a news release that it “firmly believes it did not violate any consumer
protection or data security laws.”
TJX said the settlement's
costs are already accounted for in a 2007 reserve it created. According to a
filing with the Securities and Exchange Commission filing earlier this month,
as of May 2 â” before the settlement was announced â” the reserve was $39.5 million,
the company's estimate of the total potential costs related to pending
litigation, investigations and other costs.
“The decision to
enter into this settlement reflects TJX's desire to concentrate on its core
business without distraction and to promote cyber security measures that will
benefit all consumers,” the company said in a statement.
n April 2008, TJX Cos.
offered to set aside $24 million to reimburse customers who through their
MasterCard credit cards were defrauded because of a data breach last year. A
similar agreement was made with Visa-card issuing banks the prior November for
up to $40.9 million to help banks cover costs including replacing customers
payment cards and covering fraudulent charges.
In January, TJX Cos.
offered a 15 percent discount to its customers during a “Customer
Appreciation” day to reward customers' loyalty as the company dealt with
the breach.
Eleven people were
indicted last year on charges they hacked into the systems of TJX and other
major retailers to steal the card numbers. TJX said to date, two of those
indicted pleaded guilty, and two others have pleaded guilty to related charges.
TJX Cos.
agreed to pay $9.75 million to 41 states to settle an investigation of a
massive data breach that jeopardized millions of payment card numbers. The parent
of T.J. Maxx and Marshalls will pay $7.25 million in settlement and
investigation costs. In addition, $2.5 million will go to create a data
security fund for those states.
In
January 2007, TJX disclosed that hackers had tapped into its computer systems,
which stored about 50 million customers' credit and debit card numbers. The
breach wasn't detected for more than a year.
TJX emphasized
in a news release that it “firmly believes it did not violate any consumer
protection or data security laws.”
TJX said the settlement's
costs are already accounted for in a 2007 reserve it created. According to a
filing with the Securities and Exchange Commission filing earlier this month,
as of May 2 â” before the settlement was announced â” the reserve was $39.5 million,
the company's estimate of the total potential costs related to pending
litigation, investigations and other costs.
“The decision to
enter into this settlement reflects TJX's desire to concentrate on its core
business without distraction and to promote cyber security measures that will
benefit all consumers,” the company said in a statement.
n April 2008, TJX Cos.
offered to set aside $24 million to reimburse customers who through their
MasterCard credit cards were defrauded because of a data breach last year. A
similar agreement was made with Visa-card issuing banks the prior November for
up to $40.9 million to help banks cover costs including replacing customers
payment cards and covering fraudulent charges.
In January, TJX Cos.
offered a 15 percent discount to its customers during a “Customer
Appreciation” day to reward customers' loyalty as the company dealt with
the breach.
Eleven people were
indicted last year on charges they hacked into the systems of TJX and other
major retailers to steal the card numbers. TJX said to date, two of those
indicted pleaded guilty, and two others have pleaded guilty to related charges.
