Target Reaches Settlement with Visa Over Breach

Target will pay Visa card issuers as much as $67 million as a result of costs stemming from the retail giant’s massive data breach that hit at the end of 2013, The Wall Street Journal reported, citing sources said to be close to the matter.

Currently, companies say they are struggling to comply with the patchwork of state-to-state regulations. Separately, Visa confirmed that it has reached an accord with Target. In addition to it, Target is said to be offering issuers reimbursement for fraud resulting from the applicable transactions…if those issuers don’t proceed to sue Target.

According to WSJ, Target was satisfied with the deal, while Visa relayed that “this agreement attempts to put this event behind us”.

The size of the two settlements could rival a 2010 agreement in which Heartland Payment Systems Inc. agreed to pay more than $100 million to Visa and MasterCard for a large 2008 breach.

Snyder said that the deal was conditional on a majority of the issuers entering into the direct settlement with Visa and Target. The company said cyberthieves made off with credit card and debit card information.

The $67 million will be paid to customers on top of the $10 million Target paid customers after losing a federal class action suit in April.

Unlike a $19-million agreement between Target and MasterCard Inc. that fell apart in May, this deal isn’t in danger of failing due to a lack of support from affected banks and credit unions. The result is a transfer of data that is useless to anyone except the parties involved.

The personal data of a number of Canadian shoppers was also compromised, although Target said at the time that they represented “well under” one per cent of the total.

While cardholders aren’t responsible for unauthorized purchases, lenders are on the hook to cover the cost of fraud and expense of reissuing cards when a breach occurs.