U.S. banks and retailers trade barbs over data breaches
By Emily Stephenson
WASHINGTON (Reuters) - Community banks from across the United States and some of the country's biggest retailers are at each other's throats over whose job it is to protect consumers from the kind of cyber attacks suffered last month by Target and Neiman Marcus.
The National Retail Federation delivered a shot on Tuesday, saying in a letter to U.S. lawmakers that its bank "partners" had failed to adopt new technology and instead continued to issue "fraud-prone" magnetic stripe credit and debit cards.
On Wednesday, the Independent Community Bankers of America representing about 7,000 banks in small towns, big cities and suburbs, fired back, saying the NRF should focus on its response to theft of data "rather than hurling false allegations blaming the banking industry."
ICBA members hold $1.2 trillion in assets, $1 trillion in deposits, and $750 billion in loans to consumers, small businesses and the agricultural community. The NRF represents a range of merchants in more than 45 countries.
"Retailers and their processors - not banks - are responsible for the systems in their stores that process payment cards," ICBA President and Chief Executive Officer Camden Fine said in a statement.
The exchange ratcheted up an already heated dispute over who should shoulder responsibility for cyber attacks.
Target Corp, the No. 3 U.S. retailer, disclosed in December that it was victim to one of the biggest credit card breaches on record. Target said it ran for 19 days during the lucrative holiday shopping season, with data compromised in the records of about 70 million customers.
Privately-owned luxury retail chain Neiman Marcus has said it too was victim of a cyber attack and sources have told Reuters other retail chains have been hacked. Continued...