by Burke Speaker | December 23, 2013 9:21 am
The Target (TGT) credit card information hack that has left Target customers worried, Target officials freak, and TGT stock a bit down is now leading to lawsuits.
It’s the second-largest credit card breach in US history.
The lawsuits span states and has begun with a federal investigation (via USA Today). And the reporter who first broke the story is reporting that the credit cards that were breached are now showing up for sale on the black market.
Three class-action lawsuits have been filed in the wake of the theft of data on about 40 million credit and debit card accounts of shoppers at Target from Nov. 27 to Dec. 15. More than $5 million in damages is being sought in the cases, two of which were filed in California and one in Oregon.
The Attorney General in at least four states — Connecticut, Massachusetts, New York and South Dakota – have asked Target for information about the breach. That’s the first step to a possible multi-state investigation into the breach.
The store offered a 10% discount on Saturday and Sunday at its US stores in an unusual effort at an apology to its customers.
The move is likely to be seen as not enough, especially since Target had little time to advertise and many of the products fall outside the 10% discount according to the fine print.
And a discount is not stopping the credit cards information that was stolen from being revealed online.
“Credit and debit card accounts stolen in (the Target breach) … have been flooding underground black markets in recent weeks, selling in batches of one million cards and going for anywhere from $20 to more than $100 per card,” writes Brian Krebs on his KrebsOnSecurity.com site.
After news of the breach was announced by Target on Thursday, TGT stock fell slightly — but has yet to fully recover.
The news of lawsuits and a possible federal investigation is likely to keep TGT stock down, and potentially cause more strife is card information continues to be leaked.
TGT officials were publicly quick to say the issues had been resolved.
“The issue has been identified and eliminated,” wrote CEO Gregg Steinhafel in a noteon Target’s website. “We recognize this has been confusing and disruptive during an already busy holiday season. Our guests’ trust is our top priority at Target and we are committed to making this right.”
The question is how much did TGT know — and how long did it wait until the information was released.
The lawsuits will likely answer that question, and could spell big trouble for TGT in the coming weeks.
TGT stock remains up 5% year to date.
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