Visa probably wishes they could chalk up the events of this weekend to an April Fool`s prank after news of a credit card security breach late Friday caused alarm among customers and a usage outage Sunday left some cardholders stuck at the checkout lane, unable to pay for their purchases.
In reality, the security breach appears to have been substantially smaller than initially reported, and the card outage only lasted for about 45 minutes. Still, in the wake of negative press from both events, consumers may feel uneasy about using their Visa cards and wonder if they need to be concerned about their personal information being at risk.
Hackers Cause Havoc
The security breach was first reported Friday, when the Wall Street Journal reported that Atlanta-based card-transaction-processing company Global Payments had been hacked, and that cardholders` account information could be compromised. They cited security blog Krebs on Security as the source of the news, which was confirmed later on Friday when Global Payments issued a statement saying that they were aware of a potential breach back in early March, when “the company determined card data may have been accessed.”
They said that they had contacted “appropriate industry parties to allow them to minimize potential cardholder impact” and said that “it is crucial to understand that this incident does not involve our merchants or their relationships with their customers.” Global Payments CEO Paul Garcia emphasized that the company is “open for business and [continuing] to process transactions for all of the card brands.”
Visa released a statement saying they were “aware of a potential data compromise incident at a third party entity affecting card account information from all major card brands,” and late Sunday, Visa spokeswoman Sandra Chu told CNN that they had removed Global Payments from their list of preferred processors.
A Lot of Hot Air?
Although the report from the Krebs blog called the breach “massive” and claimed that up to 10 million cardholders could be affected, Global Payments said Sunday that less than 1.5 million accounts in North America may have been affected and that the incident is contained. They further assured the public that while some data may have been exposed, cardholder names, addresses, and social security numbers were not at risk.
This breach does not begin to approach the seriousness of an incident like the Heartland Payment Systems breach, which compromised about 130 million accounts and caused Heartland to pay a $110 million settlement to credit card networks.
“My Card Was Rejected!?”
Meanwhile, on Sunday afternoon at about 2:40 pm Eastern time, some Visa cardholders might have wondered if they were the victims of a April Fool`s prank when they tried to pay for purchases with their Visa cards and had them turned down.
A system update caused the Visa network outage, said spokeswoman Sandra Chu, who obviously had a busy weekend. She emphasized that the outage was unrelated to the Global Payments security issue, and that the system was operating as usual after the brief outage.
The outage was reported to have occurred from about 2:40pm until 3:20pm, though there were reports of customers` cards being rejected into the evening on Sunday, as late as 6:40pm Eastern time.
Better Safe Than Sorry
Although all the major credit card companies, including Visa, as well as Global Payments, say that cardholders need not be concerned about card security as a result of this breach, customers can always refer to Credit-Land.com`s Security and Protection section for a wide variety of educational articles dealing with security issues.
Most credit card companies have “zero-liability” issues for fraudulent charges, as well, so be sure to notify your credit card company if you see any unusual account activity on your statement.