![]() ![]() “If the government’s probe finds Target at fault for not complying with industry-specific security standards, the company faces fines in the range of $400 million to $1.1 billion, according to an estimate by Jefferies, an equity research company,” writes the Washington Post. Moreover, as many as 10 to 15 percent of the stolen credit cards (4.8 to 7.2 million of them) have been used fraudulently-which means that Target may not only have to reimburse those charges, but also be subject to fines. ![]() Community banks, for example, paid up to $240 million to reissue 21.8 million credit cards-money they may not be able to get back from Target. In addition, dozens of lawsuits have already been filed by banks seeking to be reimbursed for their costs.Īnd there are other costs as well, that are not even borne by Target. This includes items such as $100 million to upgrade all of Target’s cash registers to accept chip-and-PIN credit cards, which are less likely to be stolen. The eventual cost could be as much as $1 billion. Gartner security analyst Avivah Litan estimates that the total cost of the breach will be between $400 and $450 million, the article continues, while John Kindervag, vice president and principal analyst at Forrester Research, told the Washington Post it wouldn’t be less than $100 million. What does that $61 million consist of? “That includes paying the card networks to cover losses and expenses related to reissuing cards, lawsuits, government investigations and enforcement proceedings,” writes USA Today. Thus far the breach has cost the company $61 million-only $44 million of which was covered by insurance, leaving Target out of pocket to the tune of $17 million. It ended up costing the IT director and the CEO their jobs, and the company’s net income dropped 46 percent in the fourth quarter of 2013. To recap, Target discovered that the records of some 110 million of its customers, including the information on up to 40 million credit cards, had been compromised. Do you know how much a data breach could cost your company? Experts are now saying that the Target data breach could end up costing $1 billion.
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