Bankers act to stem damage

Australian banks are struggling to contain the fallout of a serious credit card breach which exposed 40 million account holders last month.

About 130,000 account holders in Australia were hit by the breach after a hacker accessed the network of CardSystems Solutions, a US company that processes credit card transactions.

In the wake of the data theft, Westpac has been hit the hardest re-issuing more than 3,000 credit cards to customers in the past week.

The Commonwealth Bank has re-issued 1,000 cards, NAB 500 and ANZ 11,000 card with 400 customers actually compromised.

In response to the incident, the Australian Bankers' Association has established the Information Security Taskforce with its first meeting scheduled for July 1, 2005.

The taskforce will look at methods for customer notification in future and also at ways to improve security.

While Australian customers are upset it took six months to be notified of the breach, those affected in the US are already filing lawsuits.

A class action lawsuit has been filed in California over the CardSystems Solutions security breach claiming the payment processor was negligent in the way it maintained consumer credit data.

Ira Rothken, managing partner with The Rothken Law Firm, which filed the suit, said monetary damages aren't being sought.

"We're asking the court to order that the defendants give notice to consumers," he said. "There are millions of people whose data was compromised. If we're successful, every one will be informed if their data was compromised. And a subset of those people will hopefully be able to find out if there's any confirmed data theft."

CardSystems processes more than US$15 billion in credit card and online transactions each year.

Join the newsletter!

Error: Please check your email address.

More about ACTANZ Banking GroupCommonwealth Bank of AustraliaNABWestpacWestpac

Show Comments

Featured Whitepapers

Editor's Recommendations

Solution Centres

Stories by Michael Crawford

Latest Videos

More videos

Blog Posts

Market Place