Following a security data breach at Target Corp, the retailer will face several lawsuits for monumental losses incurred by banks and customers. Trustmark National Bank and Green Bank NA filed complaints against Target and accused it and Trustwave Holdings Inc. of failing to “secure customer information effectively, which resulted in the theft of nearly 40 million payment card records and 70 million records related to customer addresses, phone numbers and other contact details” (Stempel, 2014).
According to the two financial institutions, they incurred costs from informing their clients about data theft, providing new cards, and compensating falsified transactions. There are possibilities that losses could increase if hackers use all the data they obtained from Target.
The two financial institutions seek compensations for unspecified damages, but with massive financial consequences to Target and Trustwave. Losses from such a security breach could run into billions of dollars. The retailer will face several lawsuits. The lawsuits will be also likely to affect any third party, which handled Target’s data security services.
Personally, I believe that Target should improve data security. For instance, Target confirmed that it received warnings of the security breach, but failed to act on them. Moreover, the retailer knew that its electronic payment systems were weak, but it did not take any action to improve them. Such attacks highlight negligence and the need for any retailer to act on any breaches and be prepared for possible attacks. Target will face possible class action lawsuits.
For instance, nearly 40 million transactions and 40 million clients could have been affected by the security breach. The affected customers may come together and sue under a class action lawsuit. Trustwave must also account for its failure to update Target’s security system to meet the industry standards.
Reference
Stempel, J. (2014). Target, security auditor Trustwave are sued over data breach. Web.