Target’s big data breach could prove costly

Target early Thursday confirmed widespread media reports that it suffered a major data breach that affected as many as 40 million credit and debit card transactions during a period that began the day before Thanksgiving through December 15.

The big data breach revelation and subsequent negative publicity could not have come at a worse time as Target enters the busiest weekend of a shortened holiday season. In addition, the company remains focused on increasing the penetration rate and utilization of its proprietary REDcard credit and debit products which offer shoppers a 5% discount on most purchases.

Target said it alerted authorities and financial institutions immediately after it was made aware of the unauthorized access and identified and resolved the matter, according to a statement by the company. Target did not say when it was made aware of the unauthorized access to payment card data or whether any fraudulently activity had occurred as a result. However, the potential for illegal card use would appear to be high since Target said it determined the information involved in this incident included customer name, credit or debit card number, and the card’s expiration date and three-digit security code.

“Target’s first priority is preserving the trust of our guests and we have moved swiftly to address this issue, so guests can shop with confidence. We regret any inconvenience this may cause,” said Gregg Steinhafel, Target’s chairman, president and CEO. “We take this matter very seriously and are working with law enforcement to bring those responsible to justice.”

Target said it was working with a leading third-party forensics firm to conduct a thorough investigation of the incident and to examine additional measures that could be taken to prevent a similar incident from occurring.

“We are putting our full resources behind these efforts,” according to a statement on Target.com.

In the meantime, information Target posted on its Web site recommended customers should remain vigilant for incidents of fraud and identity theft by regularly review their account statements and monitoring free credit reports.