Target data breach costs topping $1 billion
ST. PAUL PIONEER PRESS
Two months into the Target security breach, fraud is turning up on 10 percent to 15 percent of the stolen card accounts, a security specialist said.
Based on that brisk level of criminal activity, one Wall Street analyst estimates perhaps 5 million of the 40 million stolen credit and debit cards may have been used fraudulently — an exposure that could hit Target Corp. with industry fines topping $1 billion.
Daniel Binder, an analyst at Jeffries, this week tried to make a rough estimate of Target’s liability from its holiday data breach, from Nov. 27 to Dec. 15.
“Our conclusion is the costs to Target could be significant and higher than we first thought,” Binder wrote.
He’s not the first to estimate those costs. Earlier estimates have varied wildly, with some security firms predicting immense costs to Target, but much of Wall Street expecting quite limited exposure.
As for Target itself, “We are not speculating or estimating on the potential financial impact of the breach at this time,” spokeswoman Molly Snyder said Thursday.
Binder’s numbers relied on Julie Conroy, research director for Aite Group’s retail banking practice.