Credit unions: Target hack costing up to $30M

Target’s holiday shopping season data breach is costing the nation’s credit unions an estimated $25 million to $30 million, they report.

A survey from the Credit Union National Association (CUNA), a trade group, found that the hack cost about $5.10 per new credit card issued. Added up, that comes to tens of millions of dollars for the financial institutions.

Credit unions and banks have criticized Target over the data breach. Even though the financial institutions had no involvement with the incident, they have to finance the cost of reissuing new cards for shoppers affected by the hack.

“Contrary to what some may think, these expenses will not be reimbursed to credit unions and their members by Target or other retailers,” CUNA President Bill Cheney said in a statement. “Rather, credit unions must solely cover these costs of card program administration, including in these circumstances of reacting to a merchant data breach.”

{mosads}Cheney added that the costs could rise, if greater losses are reported as result of the hack.

Credit unions have asked Congress for new legislation to hold retailers, not financial institutions, responsible for bearing the cost of reissuing cards and shoring up customers’ finances after a data breach.

In November and December, hackers broke into Target’s data and stole information about as many as 40 million debit and credit cards. The Minneapolis-based retailer also reported that up to 70 million people’s names, addresses, telephone numbers or other personal details were stolen in the data breach.

Over the weekend, two Mexicans were arrested in connection with the hack in the border town of McAllen, Texas.