Welcome!

News Feed Item

NAFCU: Credit Unions Pay High Price for Data Breaches

The National Association of Federal Credit Unions’ (NAFCU) February Economic & CU Monitor survey found that credit unions, and by extension their 96 million members, are paying a high price for retailers’ data breaches. NAFCU estimates that the recent Target data breach could end up costing the credit union community nearly $30 million. Among those surveyed, the average cost for the Target data breach was $45,000.

“The survey findings are staggering. Credit unions are being hit by a double whammy in terms of numbers of possible data breaches and costs while they continue to pick up the tab for retailers who are not subject to the same high level of data security standards,” said NAFCU Chief Economist and Director of Research David Carrier. “It is ironic that despite the ample rules in place to ensure data protection standards at financial institutions like credit unions, merchants and retailers are not held accountable for data breaches. Cybercriminals will continue to capitalize on this double standard and wreak havoc with consumers and our economy.”

NAFCU’s Economic & CU Monitor on data security reported:

  • Respondents were alerted to a possible breach 263 times on average in 2013, and the average amount spent on data security measures was $158,600.
  • Respondents reported an average of $152,000 for data breaches in 2013. The median cost was $59,000.
  • The bulk of these costs were related to fraud losses and investigations (46.7 percent), followed by reissue costs (34.4 percent) and monitoring costs (19 percent). Reissuing cards takes 7 days, on average, and costs $5 per card.
  • Almost half (42 percent) of respondents confirmed that their reputation had been harmed due to a merchant data breach.
  • Survey respondents indicated that an average of 10,300 cards were affected by merchant data breaches in 2013.

NAFCU was the first financial services trade association to weigh in on this issue on Capitol Hill and urged Congress to take action and set national data security standards for retailers and merchants. Financial institutions, including credit unions, have been subject to standards on data security since 1999 under the Gramm-Leach-Bliley Act. However, retailers and other entities that handle sensitive personal financial data are not. So, when a data breach occurs, financial institutions bear a significant burden as the issuers of payment cards used by millions of consumers.

NAFCU is urging Congress to pass S. 1927, the “Data Security Act of 2014,” by Sens. Tom Carper, D-Del., and Roy Blunt, R-Mo. This bill leaves intact the federal standards already imposed on financial institutions and seeks to extend the protection further, by setting national standards for all merchants and retailers to follow in protecting data, providing timely breach notification and paying their share of the clean-up when breaches occur.

NAFCU’s Economic and CU Monitor is a member-only monthly e-newsletter of the latest macroeconomic and financial trends affecting today's credit unions, including trend data among NAFCU member federal credit unions.

The National Association of Federal Credit Unions is the only national organization that focuses exclusively on federal issues affecting credit unions, representing its members before the federal government and the public.

More Stories By Business Wire

Copyright © 2009 Business Wire. All rights reserved. Republication or redistribution of Business Wire content is expressly prohibited without the prior written consent of Business Wire. Business Wire shall not be liable for any errors or delays in the content, or for any actions taken in reliance thereon.

Latest Stories
FinTechs use the cloud to operate at the speed and scale of digital financial activity, but are often hindered by the complexity of managing security and compliance in the cloud. In his session at 20th Cloud Expo, Sesh Murthy, co-founder and CTO of Cloud Raxak, showed how proactive and automated cloud security enables FinTechs to leverage the cloud to achieve their business goals. Through business-driven cloud security, FinTechs can speed time-to-market, diminish risk and costs, maintain continu...
With tough new regulations coming to Europe on data privacy in May 2018, Calligo will explain why in reality the effect is global and transforms how you consider critical data. EU GDPR fundamentally rewrites the rules for cloud, Big Data and IoT. In his session at 21st Cloud Expo, Adam Ryan, Vice President and General Manager EMEA at Calligo, will examine the regulations and provide insight on how it affects technology, challenges the established rules and will usher in new levels of diligence a...
Existing Big Data solutions are mainly focused on the discovery and analysis of data. The solutions are scalable and highly available but tedious when swapping in and swapping out occurs in disarray and thrashing takes place. The resolution for thrashing through machine learning algorithms and support nomenclature is through simple techniques. Organizations that have been collecting large customer data are increasingly seeing the need to use the data for swapping in and out and thrashing occurs ...
As many know, the first generation of Cloud Management Platform (CMP) solutions were designed for managing virtual infrastructure (IaaS) and traditional applications. But that’s no longer enough to satisfy evolving and complex business requirements. In his session at 21st Cloud Expo, Scott Davis, Embotics CTO, will explore how next-generation CMPs ensure organizations can manage cloud-native and microservice-based application architectures, while also facilitating agile DevOps methodology. He wi...
When you focus on a journey from up-close, you look at your own technical and cultural history and how you changed it for the benefit of the customer. This was our starting point: too many integration issues, 13 SWP days and very long cycles. It was evident that in this fast-paced industry we could no longer afford this reality. We needed something that would take us beyond reducing the development lifecycles, CI and Agile methodologies. We made a fundamental difference, even changed our culture...
yperConvergence came to market with the objective of being simple, flexible and to help drive down operating expenses. It reduced the footprint by bundling the compute/storage/network into one box. This brought a new set of challenges as the HyperConverged vendors are very focused on their own proprietary building blocks. If you want to scale in a certain way, let’s say you identified a need for more storage and want to add a device that is not sold by the HyperConverged vendor, forget about it....
In the enterprise today, connected IoT devices are everywhere – both inside and outside corporate environments. The need to identify, manage, control and secure a quickly growing web of connections and outside devices is making the already challenging task of security even more important, and onerous. In his session at @ThingsExpo, Rich Boyer, CISO and Chief Architect for Security at NTT i3, discussed new ways of thinking and the approaches needed to address the emerging challenges of security i...
Docker containers have brought great opportunities to shorten the deployment process through continuous integration and the delivery of applications and microservices. This applies equally to enterprise data centers as well as the cloud. In his session at 20th Cloud Expo, Jari Kolehmainen, founder and CTO of Kontena, discussed solutions and benefits of a deeply integrated deployment pipeline using technologies such as container management platforms, Docker containers, and the drone.io Cl tool. H...
Cloud adoption is often driven by a desire to increase efficiency, boost agility and save money. All too often, however, the reality involves unpredictable cost spikes and lack of oversight due to resource limitations. In his session at 20th Cloud Expo, Joe Kinsella, CTO and Founder of CloudHealth Technologies, tackled the question: “How do you build a fully optimized cloud?” He will examine: Why TCO is critical to achieving cloud success – and why attendees should be thinking holistically ab...
The question before companies today is not whether to become intelligent, it’s a question of how and how fast. The key is to adopt and deploy an intelligent application strategy while simultaneously preparing to scale that intelligence. In her session at 21st Cloud Expo, Sangeeta Chakraborty, Chief Customer Officer at Ayasdi, will provide a tactical framework to become a truly intelligent enterprise, including how to identify the right applications for AI, how to build a Center of Excellence to...
SYS-CON Events announced today that Datera, that offers a radically new data management architecture, has been named "Exhibitor" of SYS-CON's 21st International Cloud Expo ®, which will take place on Oct 31 - Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Datera is transforming the traditional datacenter model through modern cloud simplicity. The technology industry is at another major inflection point. The rise of mobile, the Internet of Things, data storage and Big...
Blockchain is a shared, secure record of exchange that establishes trust, accountability and transparency across business networks. Supported by the Linux Foundation's open source, open-standards based Hyperledger Project, Blockchain has the potential to improve regulatory compliance, reduce cost as well as advance trade. Are you curious about how Blockchain is built for business? In her session at 21st Cloud Expo, René Bostic, Technical VP of the IBM Cloud Unit in North America, will discuss th...
An increasing number of companies are creating products that combine data with analytical capabilities. Running interactive queries on Big Data requires complex architectures to store and query data effectively, typically involving data streams, an choosing efficient file format/database and multiple independent systems that are tied together through custom-engineered pipelines. In his session at @BigDataExpo at @ThingsExpo, Tomer Levi, a senior software engineer at Intel’s Advanced Analytics ...
SYS-CON Events announced today that Datera will exhibit at SYS-CON's 21st International Cloud Expo®, which will take place on Oct 31 – Nov 2, 2017, at the Santa Clara Convention Center in Santa Clara, CA. Datera offers a radically new approach to data management, where innovative software makes data infrastructure invisible, elastic and able to perform at the highest level. It eliminates hardware lock-in and gives IT organizations the choice to source x86 server nodes, with business model option...
"Cloud computing is certainly changing how people consume storage, how they use it, and what they use it for. It's also making people rethink how they architect their environment," stated Brad Winett, Senior Technologist for DDN Storage, in this SYS-CON.tv interview at 20th Cloud Expo, held June 6-8, 2017, at the Javits Center in New York City, NY.