Credit Card Security Breach: Five Things to Consider

Data security is a hot topic of every news outlet thanks to the recent Target and Neiman Marcus security breaches. While it’s still unclear how much damage has been done, the virtual crime exposed an estimated 70 million people to the possibility of identity theft. Consider the effects of this event as you wait for the dust to settle. While corporate security is out of your control, there are a few things every person can learn and do to protect themselves.

1. Your creditor should take action.

You may never hear from Target or Neiman Marcus directly if you were affected by either security breach, but your creditor is another story. At the very least, they should provide:

  • A letter detailed if/when your card was used at the affected retailer
  • A plan to provide a new card or monitor your existing account
  • Updates regarding the latest security measures and plans of action

2. The damage could be delayed.

Investigators believe that the Target and Neiman Marcus breaches began in mid-November in a series of smaller attacks. That said, the larger scope of identity theft was not detected until January. This delay signifies a lengthy problem for consumers and retailers alike. While your credit may seem untouched today, it’s difficult to know whether your account will be affected in the future. Keep tabs on your bank accounts, credit and debit cards in the days ahead.

3. It’s time to prioritize your credit card usage.

You may have scoffed at cautious credit users in the past, but it’s time to learn from their habits. They never use a credit card for department store payments, only provide their number to secure websites and monitor their credit scores carefully. While Target and Neiman Marcus may not seem like high-risk locations for identity theft, millions of people were affected by the collective breach. Avoid being one of many in the future by imposing stricter usage of your credit and debit cards. A good rule of thumb: if security isn’t guaranteed, stick to cash.

4. Change is a possibility.

While Target is taking steps to right security wrongs by offering customers 12 months of free credit monitoring, many argue that this gesture isn’t enough. The security breach has launched a national discussion about the symbiotic relationship between retailers and creditors. Although J.P. Morgan Chase issued new cards to 2 million affected customers, Wells Fargo and other banks argued that the retailers should bear the cost of replacing customer credit cards.  A full debate is scheduled to go before the Senate banking committee, an event that could lead to legislation enforcing stricter security regulations.

5. Credit responsibility is still yours to manage.

While a breach beyond your control is unfair, it’s still your responsibility to manage and protect your credit score. Do your best to avoid exposure in the future and keep tabs on your existing accounts by ordering copies of your credit reports. Highlight suspicious information and follow up with your creditors and the bureaus as soon as possible.