FARMERS BRANCH, Texas (1/29/14)--Retailers should be held more accountable for data breaches, such as the recent Target security breach, an Arkansas credit union CEO recently told the Cornerstone Credit Union League.
Like virtually every other credit union, Mil-Way CU, Texarkana, Ark., holds itself to high standards in protecting its members' personal data, Mil-Way CU CEO Allen Brown told the Cornerstone league, which serves credit unions in Texas, Oklahoma and Arkansas (Leaguer Jan. 28). Despite its best efforts, the $105 million-asset credit union was required to replace 500 debit cards in the wake of the recent Target security breach.
Unfortunately, when members swipe their debit cards at restaurants, gas stations or retailers, credit unions are at the mercy of the merchant to secure the network, Brown said.
"Mil-Way FCU performs its due diligence to keep our members and their personal data safe," Brown said. "We adhere to strict security policies and procedures. We have firewalls in place to prevent intruders from accessing our network. And we perform periodic penetration testing to ensure the systems we have in place are working.
"But more importantly, we had to restore member confidence," Brown said. "Anytime there is a data breach of this magnitude, it affects members' confidence. The last thing we want is for members to be afraid of using their debit card."
Members didn't necessarily understand that the credit union was not in any way responsible for the breach, so Mil-Way CU spent a significant amount of time briefing its member service team on the Target breach, so member representatives could could inform and educate members.
Brown said the credit union encourages members to monitor their accounts at least weekly-- if not daily--so they can identify fraudulent activity as early as possible.
Media continue to detail the effects in their regions with numbers drawn from the Credit Union National Association's survey on the Target data breach. The League of Southeast Credit Unions told the South Florida Business Journal that Florida credit unions have lost at least $1.41 million because of the massive Target customer data breach. The breach cost Alabama credit unions $400,000, LSCU told the Birmingham Business Journal.
The Pennsylvania Credit Union Association told Lancaster Online that state credit unions lost $1 million as result of the breach.
And, Politico noted the results of CUNA's survey in a Tuesday article "Banks, stores tout cards with chips as security cure: But chip wouldn't have stopped breach." Credit unions have incurred between $25 million and $30 million in initial costs due to the breach.