Sen. Schumer Takes Aim At Target, Wants Transparency In Wake Of Security Breach
NEW YORK(CBSNewYork) — New York Senator Chuck Schumer has a bull’s eye in his cross-hairs.
Schumer said that it is time for the Consumer Financial Protection Bureau to open an investigation into how 40 million credit card and debit card accounts were hacked at Target between Black Friday and mid-December, WCBS 880’s Monica Miller reported.
Bobby from the Bronx told 880’s Miller that he trusts the chain’s claims that they have fixed the security breach, he paid for his purchase with a credit card but said that there needs to be better guidelines in place to protect payment information.
“There is a lot of people out there that are out to just do bad things with people’s credit,” he said.
Bobby knows first hand what it is like to have personal information stolen.
“Once it is done to you it is a process where you have to show proof,” he said.
Senator Schumer has asked how customers can know if target has really fixed the problem when the store refuses to tell us what the problem was.
In response to Schumer’s comments, Charles Bell, programs director for Consumer Reports Consumers Union said the senator was correct to say federal authorities need to investigate.
“I think if the issue gets sufficient priority, we can deter these types of breaches from happening,” Bell said, “and really, we have to, because how will consumers have confidence in credit cards and debit cards if this is a constant reality in the marketplace?”
Bell said the federal Consumer Financial Protection Bureau has the power and the mandate to probe the incident.
“This agency has substantial power to subpoena records and to do detailed investigations, and make recommendations to Congress and to the financial regulatory agencies, so consumers have a very strong watchdog now that can really bring substantial power to bear,” he said.
But as CBS 2’s Cindy Hsu reported, experts said a large-scale data theft like what happened at Target will likely happen again. They blamed it on the magnetic strips on the backs of debit and credit cards, which are easy to copy.
“They’ll steal large numbers of credit card account numbers, and then print counterfeit cards and use those cards until they’re reported stolen,” said Jason Oxman of the Electronics Transaction Association.
The credit card industry said criminals will have a much harder time making counterfeit cards once the industry replaces the magnetic strips with digital chips in 2015, although Schumer said that is not soon enough.
JPMorgan Chase has responded to the breach by limiting customers’ ATM withdrawals to $100 per day and limiting debit purchases to $300 per day. About 2 million Chase customers were affected.
A bank spokeswoman called the restrictions an unfortunate but necessary security measure.
“We know it’s a bad time of year, but we had to do that immediately to protect our customers and protect their accounts. We’d rather overreact than under-react,” Kristin Lemkau told the New York Post.
More than a third of Chase Bank branches nationwide opened their doors for the affected customers Sunday.
Limits will remain in place until potentially compromised cards are reissued, the Post reported.
Meanwhile, Target has been trying to lure in weekend shoppers by offering a 10 percent discount, in a push to repair its image.
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