News broke that 40 million accounts of Target shoppers were breached in a widespread hack.
Security Savings Bank would be blocking all customer transactions. The decision to block all transactions came from "recent fraudulent activity occurring [sic] on customers' compromised cards," according to the bank's message.
Small financial institutions have faced an uphill battle since they lack the infrastructure to produce new cards quickly and the budgets to cover potential fraud incidents.
Consumers have already begun suing Target for such consequences. On Dec. 23, Target shopper Janice McCarter filed a class-action lawsuit in the Northern District of Illinois on behalf of customers, citing Target's alleged "failure to reasonably and properly secure" their data.
The National Association of Federal Credit Unions has sent a letter to congressional leaders calling for retailers to be subject to the same standards of data security as the banking industry.
"Credit unions and other financial institutions—not retailers and other entities—are out front protecting consumers, picking up the pieces after a data breach occurs."
Source: www.cnbc.com
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Banks spent a significant portion of their resources on their data security and security measures as they are subjected to Authorities monitoring but the businesses handling customers' info are not subjected to same standards of data security guidelines.
A similar scenario would not cause a large impact in Malaysia due to the low adoption rate of transacting via a debit account.
But are the banks ready to handle potential fraudulent cases on such a large scale involving investigations and data? Do the banks have enough infrastructure to work around the situation? Not forgetting that with the block of credit cards, debit cards and online transactions, customers are going to queue up for cash withdrawals.
Based on the scenarios above, business are the main entry points for the data breach but ultimately the financial institutions are bearing the consequences.
How are Credit Unions and Central Banks in Asia ensuring that data securities are taken seriously by all parties?
