Credit Card Processor: We Goofed
Breached Company Admits It Shouldn't Have Had Consumer Records
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Play CBS Video Video Credit Card Data Breach On The Early Show, Money magazine's Ellen McGirt discussed credit card security breaches, the most recent involving CardSystem Solutions which processes payments for MasterCard, Visa and Amex.
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Video Credit Card Attack 40 million credit card numbers were stolen in the largest heist ever of personal financial information. The companies that know which accounts were compromised are not talking. Tony Guida reports.
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The official, John Perry, chief executive of Atlanta-based CardSystems Solutions Inc., said that the records known to have been stolen covered roughly 200,000 of the 40 million compromised credit card accounts, from Visa, MasterCard, and other companies.
"This particular company, CardSystems, processes $15 billion in transactions a year. This is huge," Money magazine's Ellen McGirt told CBS News Early Show co-anchor Harry Smith.
Perry said the data was being stored for "research purposes" to determine why some transactions had registered as unauthorized or uncompleted. "We should not have been doing that," Perry said in Monday's editions of The New York Times.
Under rules established by Visa and MasterCard, processors cannot retain cardholder information after handling transactions.
"CardSystems provides services and is supposed to pass that information on to the banks and not keep it," Joshua Peirez, a MasterCard official, told the Times. "They were keeping it."
The security breach was first reported Friday when MasterCard International Inc. said computer hackers may have accessed more than 40 million credit card accounts. About 13.9 million were from MasterCard accounts.
"Because MasterCard has been on top of it pretty much, we're not recommending that people cancel accounts. Wait until you hear from your issuer," said McGirt. "But everybody needs to be vigilant. This is a time when the consumer needs to be checking their credit reports and opening their mail. All the things that we should be doing anyway to make sure there's no suspicious activity."
Reporting fraudulent use of a credit card limits the cardholder's responsibility to $50.
"But it's a hassle. It's a huge hassle," said McGirt. "The onus of responsibility is on you to document that these were not your charges. That's where it gets tough."
©MMV CBS Broadcasting Inc. All Rights Reserved. This material may not be published, broadcast, rewritten, or redistributed. The Associated Press contributed to this report.
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