Saturday, May 19, 2007

TJX Discovering Cost of Security Failure

Here is a pretty good reason to make sure your company is doing a good job of protecting customer data: TJX: Data breach damage $25 million and counting.

That's right, according to SearchSecurity, the bottom line for TJX Companies Inc. took a big hit in the first quarter of 2007, thanks to a $12 million charge tied to the security breach that exposed at least 45.7 million credit and debit card holders to identity fraud. In total, the breach has cost the company about $25 million to date. And that doesn't include the cost of customers who decided to shop elsewhere.

TJX executives better hope that they can document the security policies and practices they had in place to prevent the hacking that took place. If a judge deems them to be up to par, they may avoid censure even though they were hacked. An active and well-documented security program is a good defense against charges of negligence or failure to meet the standard of due care.

1 comment:

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