More Target-sized security breaches will happen if banks and retail stores don’t start working together to further protect customers’ data, JPMorgan Chase’s CEO Jamie Dimon said Jan. 14.
JPMorgan has replaced 2 million credit and debit cards as a result of the Target breach, Dimon said. That number is expected to rise. JPMorgan is the world’s largest issuer of credit cards.
Dimon expects that cybercrimes such as the Target breach will become more common if retailers and banks do not work on security, he said.
“This story is not over, unfortunately,” Dimon said in a conference call with investors following the bank’s fourth-quarter earnings announcement.
In December, Target said 40 million credit and debit card accounts — including customers’ card numbers, expiration dates, debit-card PINs and the embedded code on the magnetic strip on the back of cards— were stolen in a data breach that happened between Nov. 27 and Dec. 15. The week of Jan. 6, the company disclosed that hackers stole an additional trove of data affecting 70 million people. That data included names and phone numbers as well as email and mailing addresses. The company said there is some overlap between the two data sets.
On Jan. 13, Idaho Attorney General Lawrence Wasden issued a statement advising Idaho consumers to consider a free credit monitoring offer Target Corp. offered to all of its customers.
The offer includes one year of free credit monitoring beginning Jan. 13.
“Target has taken the extraordinary step to offer free credit monitoring to all of its customers, not just those affected by the breach. This is an opportunity Target customers may want to take advantage of, depending on individual circumstances,” Wasden said. “Having credit information stolen can wreak havoc in your life. Credit monitoring is one tool you can use to protect yourself.”
Wasden also says consumers who have not done so should change their PINs and passwords.
The Target data breach is the second-largest theft of shoppers’ credit card data, following the theft of 90 million customers’ data from discount retailer TJX in 2007.
Dimon said the bank hasn’t seen a reduction in consumer spending due to the breach, and there are no signs that consumers moved to other forms of payment, like cash or checks.
Banks and the stores that accept their credit and debit cards have had a complicated relationship for years.
Stores want to accept credit and debit cards because it’s often a customer’s preferred form of payment. But every time a shopper swipes a credit or debit card, a bank charges a small fee. That fee, known as an interchange fee, adds up to billions of dollars in revenue for the banks. It’s why stores like gas stations charge customers more to use credit or debit cards versus cash.
“This might be a chance for retailers and banks, for once, to work together as opposed to suing each other like we’ve been doing the last decade,” Dimon said.