Customers shop in the pharmacy department of a Target store in the Brooklyn borough of New York in this June 15, 2015 file photo.BRENDAN MCDERMID/Reuters
Target Corp. reached a settlement with Visa Inc. over a hacker attack that struck the chain during the 2013 holiday season and exposed millions of customers' personal information.
The retailer will pay as much as $67-million to banks that issue Visa cards, according to a person briefed on the matter, who asked not to be identified because the amount hasn't been disclosed publicly. The agreement will cover expenses that banks incurred in the data breach, including the cost of reissuing cards and any fraud that resulted from the incident.
"Target is pleased that we have reached a settlement agreement with Visa related to the data breach," the Minneapolis-based retailer said in a statement. The Wall Street Journal reported the settlement earlier Tuesday.
Hackers stole credit– and debit-card data, as well as personal information, for as many as 110 million Target customers during the 2013 holiday shopping season. The retailer also agreed to pay $10-million to customers whose personal information may have been taken.
Target previously reached an agreement with MasterCard Inc. to pay banks $19-million for costs they incurred in the data breach. But that pact failed to garner sufficient support from banks, Target said in May.
Target shares rose 0.8 per cent to $79.62 as of 12:46 p.m. in New York trading, while Visa declined 0.3 per cent to $74.19.
CEO's Departure
The costs of the Visa settlement are already reflected in the retailer's previously reported financial results, Target said on Tuesday. The hacker attack contributed to the ouster last year of Chief Executive Officer Gregg Steinhafel, who said he held himself personally responsible for the breach. Still, Target is one of many chains to fall victim to hackers in recent years. Neiman Marcus Group Ltd., Sally Beauty Holdings Inc. and other retailers also have suffered incursions.
Visa, the world's biggest payments network, said in a statement that the agreement "attempts to put this event behind us, and increase the industry's focus on protecting against future compromises with new technologies."