Target continues to put the disastrous 2013 holiday-season data breach behind it, agreeing today to pay $39.4 million to banks claiming they lost money during the hack.
Reuters reports that Target has reached a settlement, which still requires court approval, over reimbursing banks for their costs of covering fraudulent charges and issuing new credit and debit cards as a result of the breach.
The agreement covers all banks that had not previously released their claims against the retailer.
In the wake of the massive hack, which went on for weeks before being detected in late 2013, card issuers say they spent hundreds of millions of dollars issuing replacement cards and dealing with fraudulent charges tied to the breach.
Under the proposed settlement, Target will pay up to $20.25 million directly to the banks, and $19.11 million to fund a MasterCard Inc. program related to the breach.
A spokesperson for the company says it is “pleased that the process is continuing to move forward.”
The proposed agreement comes three months after a judge gave the go-ahead for banks to pursue a class-action lawsuit against the retailer.
By certifying the class-action status of the case, the judge gave the plaintiffs more leverage in negotiations with the retailer and made the hefty settlement more likely.
In August, the retailer reached a deal with Visa to give about $67 million back to consumers affected by the breach.
While the figure was attributed to “people familiar with the situation,” the company later confirmed the payment amount in an SEC filing.
“In August 2015, we entered into a settlement agreement with Visa under which we will pay up to $67 million to eligible Visa card issuers worldwide that issued cards that Visa claimed to have been affected by the data breach,” the filing reveals.
In the wake of the massive hack, which went on for weeks before being detected in late 2013, card issuers say they spent hundreds of millions of dollars issuing replacement cards and dealing with fraudulent charges tied to the breach.
The company previously settled a class-action case from consumers in March by agreeing to pay $10 million. The settlement was believed to potentially pay individual victims up to $10,000 in damages.
Target in $39.4 million settlement with banks over data breach [Reuters]
by Ashlee Kieler via Consumerist
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