Too Big For Their Breaches....

"Gimme Shelter..."

Despite the massive legal and legislative wranglings, over the last few years,
between retailers and credit card issuers, one major source of argument and friction remains unresolved. That issue, that source of ill-will and dispute, is the question of responsibility, accountability, and liability for losses associated with credit card "breaches".

A "breach" arises when individual consumer

"Dishonest hacktivity..."

credit card data is stolen from the computer systems of a merchant or card processor. Generally the breach occurs due to the dishonesty or lack of training of a retail employee, or from a flaw or lapse in the security and controls protecting the retailer's card processing systems.  

The mischief and financial losses which result from the misuse of stolen credit card data can be extremely costly to the retailer, card issuer and the consumer.

Kiss It Good-bye...!

Retail card breaches are not an infrequent occurrence as most credit union card issuers know. Most frustratingly, retailers and merchants have a well-established reputation for failure to acknowledge their card processing lapses.  Deny, stall, and delay are favorite tactics.  

In the meantime, the consumer feels threatened, uncertain, and betrayed, while the credit union bears the costs of notification, card replacement, and trying to help manage the outrage and frustration of the members who have been victimized.  

Had an example of the very high "reputation cost" of a breach to the credit union just last week.  Was on the receiving end of a complaint call from a highly infuriated, female credit union member of long-standing. Didn't even get the slightest opportunity to offer my explanation that "the CU didn't cause the breach" before:

"And further more..."

"I've been a member for over thirty years and have always counted on the CU to look after my money and protect my privacy. Heard you claim all these years that the CU is working in the best interests of the members. Well, this is the third replacement card I've gotten in the last two years!  What kind of slip-shod operation are you running down there ? How can any of us trust you if you can't keep up with your credit card numbers; when did you stop hiring honest employees?  Don't you think the members should hire some new blood that can run the place right?!??!"

Well, you get the picture (and she was  just "warming up"), but what made this situation particularly frustrating for me was ...

... the member who was giving me up and down the river was 

my wife !!!

If merchants and retailers continue to demand reductions in interchange fees, then out of fairness they must start taking responsibility for their breaches ...

... and start taking the calls from my wife !