Push grows for scrutiny of Target data breach

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Posted: Tuesday, December 24, 2013 12:00 am

Target continues to suffer blow-back from the breach of up to 40 million customer credit and debit card accounts it disclosed last week, as consumer perception of the chain plunges and calls for an investigation intensify.

In a letter to the Federal Trade Commission, Sen. Richard Blumenthal, D-Conn., said the agency should look into Target’s responsibility in the massive hack.

He said that the scope and duration of the intrusion, which Target said Thursday occurred between Nov. 26 and Dec. 15, suggests that the retailer may have relied on a lax security program that “does not live up to a reasonable standard.”

“Its conduct would be unfair and deceptive, and it would clearly violate the FTC Act,” Blumenthal wrote.

He said that affected customers could watch their credit suffer or, at the least, “live with the fear and uncertainty” of potential victimization.

“If Target failed to adequately and appropriately protect its customers’ data, then the breach we saw this week was not just a breach of security; it was a breach of trust,” Blumenthal wrote.

Already, several state attorneys general have said they’ve asked Target for information about the hack. And at least two lawsuits have been filed by customers seeking class-action status.

Nebraska Attorney General Jon Bruning said Monday he has joined with other state attorneys general to gather information on the data breach.

“Nebraskans shouldn’t suffer financial fallout from a retailer’s lack of security and oversight,” Bruning said in a statement.

He said his office last year helped draft and support a bill that proposes to require retailers to provide information to customers when such lapses occur.

“With approximately 40 million Americans affected, this breach is exactly why LB 61 was created,” Bruning said. “Companies must be held accountable for protecting consumer information.”

Introduced in January 2013 by State Sen. John Murante of Gretna, LB 61 would require businesses to notify the Attorney General’s Office of data breaches involving Nebraskans. The bill was in review by the Legislature’s Judiciary Committee when the body adjourned in June.

Monday, Target said it had reached out to the attorneys general and invited them to a call with the chain’s general counsel. The company also confirmed that it is working with the U.S. Secret Service and the Department of Justice on its own probe into the malware that affected point-of-sale systems in U.S. stores.

Customers on Friday had flocked to Target’s Facebook profile to complain of being unable to reach the retailer for answers. On Monday, Target said it is still dealing with “a high volume of calls” and said it has more than doubled the number of employees manning phones around the clock.

The company said it has communicated with 17 million customers via email.

But the perception of Target among consumers has already taken a hit, dropping to its lowest point since at least June 2007, according to sentiment tracking service YouGov BrandIndex. It’s also the first time in more than six years that negative perception of Target has outweighed positive feelings about the brand.

This even though Target Chief Executive Gregg Steinhafel tried to soothe patrons with a 10 percent discount on most Target products purchased over the weekend as well as the promise of free credit monitoring services for shoppers affected by the breach.

World-Herald staff writer Russell Hubbard contributed to this report.

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