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Breach exposes debit card accounts at Suncoast Federal Credit Union to fraud

About 56,000 members of Suncoast Schools Federal Credit Union have been notified that their debit card accounts were exposed to fraud.

It is the latest casualty of last year's breach of Heartland Payment Systems, one of the country's largest credit card processors, where information from more than 100 million credit and debit card transactions was exposed.

Not until the end of May did Suncoast discover that some of its customers who use Visa Check Cards could be in danger. The Tampa credit union is issuing new cards to all members whose accounts were compromised.

"It was not a Suncoast exclusive event nor was it through any fault of our own," said Melva McKay-Bass, senior vice president of member service operations for Suncoast. "It was not anything that we had done wrong."

Suncoast, which has more than 450,000 members, has determined that less than 1,000 members were actually affected by fraud as of Wednesday, McKay-Bass said.

Only encrypted card data was compromised, not personal information such as names, addresses and Social Security numbers. The credit union began notifying affected members by letter in the first week of June, McKay-Bass said.

Suncoast released a statement explaining the breach Friday in response to what it said was an inaccurate Fox News report that, McKay-Bass said, panicked some of its members.

"If you hear on the news that there has been a breach or harsh words such as breach or internal security situation, as a customer of that financial institution, I would call to see if my account is safe, so that is exactly what has happened. … And that is exactly what we wanted to avoid," she said.

Visa has a zero liability fraud policy that allows people who report fraud to recoup their money. Affected members won't experience any interruptions of service, but there will be some time overlap between when members receive new cards and when the old ones are canceled.

"At no time do we want them to be without their plastic so we want to make sure that the new card is in hand before the old card is canceled," McKay-Bass said.

This is the first time Suncoast has reissued this many cards, and it is unrealistic to say that this will be its last, she said.

It is not unusual for the effects of security breaches to span several years, said Avivah Litan, security analyst for Gartner Research.

In 2007, TJX Cos., operator of T.J. Maxx and Marshalls, announced it suffered a security intrusion that spanned several years and exposed as many as 100 million accounts.

There has been a recent trend of hackers infiltrating payment processors, Litan said.

When a card is used, the charge goes to a payment processer and then to the bank for approval. Hackers use the data to make counterfeit cards and make purchases, she said.

"The banks get very upset about this because they have to absorb the costs, so sometimes it's easier to just shut down the account and reissue the cards," Litan said.

It is common for credit unions to reissue cards because they often lack the infrastructure to deal with heavy phone traffic from concerned members and to monitor at-risk accounts, she said.

Consumers are growing numb from data breaching reports, said Sara Peters, senior editor of Computer Security Institute in San Francisco.

"People are starting to get used to this kind of thing," she said. "The amount of nervousness or outrage when people receive these notification letters is starting to dwindle."

Suncoast is encouraging its members to continue to monitor their accounts and contact the credit union if there is any strange activity.

FAST FACTS

Ways to prevent account fraud

• Check accounts online for unusual charges.

• If you see any mail from your financial institution, open it immediately.

• Don't share your PIN number with anyone.

• Shred personal financial information like bank receipts.

• Don't keep debit card and pin number together.

• Call the post office to change your address or if you are going out of town.

For more information about preventing fraud, visit www.myfloridalegal.com.

Breach exposes debit card accounts at Suncoast Federal Credit Union to fraud 06/17/09 [Last modified: Thursday, June 18, 2009 5:20pm]
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