Prepaid Debit Card Reviews, Complaints, Etc

Tag: target

Data Breach Forces Target CEO Out

It was just too much to recover from, in the end. On May 5, Target announced that Gregg Steinhafel, the company’s president, CEO and chairman of the board of directors, would resign immediately. The move ended a three-decade-plus career at the retailer as well as a months-long effort to lead Target beyond the many problems that crept up after a data breach impacted tens of millions of customers last December. Target’s chief financial officer, John Mulligan, was appointed interim president and CEO.

In a statement that lauded Steinhafel’s long tenure at Target, the company’s board made it clear that it was time for a change. “After extensive discussions, the board and Gregg Steinhafel have decided that now is the right time for new leadership at Target,” says the statement. In its statement, Target also said that Steinhafel not only led the response to the data breach but also held himself “personally accountable and pledged that Target would emerge a better company.”

Some observers believe that, even though his continued leadership proved unworkable, Steinhafel has done just that. In an article on MarketWatch, writer Philip van Doorn said it was ironic that Steinhafel was being ousted because of the ongoing impact of the data breach even though Target is “leading the way in upgrading payment security for consumers.”

Indeed, as van Doorn points out, Target announced last month that its efforts to implement far superior chip-and-PIN technology for its store-branded credit cards will be completed by early 2015. “In addition to implementing chip-and-PIN verification for its store-branded cards, Target will complete the installation of devices for the use of chip-and signature and chip-and-PIN verification for non-Target credit cards in September, with the software in place in early 2015,” writes van Doorn.

May 6, 2014
Target Speeds Move to EMV Cards

Target has vowed to do what it can to speed the US’s transition to more secure payment card technology.

In testimony before the Senate Judiciary Committee, Target Chief Financial Officer, John Mulligan, said that one of the company’s responses to the massive data breach that impacted tens of millions of its customers in late 2013 would be to equip all 1,800 of its U.S. stores with card readers able to process EMV card transactions by the beginning of 2015. The new timeline announced by Mulligan is over six months earlier than Target’s previously stated goal for implementing smart card technology in its stores. EMV cards, also known as smart cards, are considered far more difficult for hackers to compromise than the magnetic stripe technology currently used by most credit and debit cards.

Additionally, Mulligan told lawmakers that Target’s own REDcards will also transition entirely to EMV technology. “Updating payment card technology and strengthening protections for American consumers is a shared responsibility and requires a collective and coordinated response,” Mulligan said. “On behalf of Target, I am committing that we will be an active part of that solution.”

Target is undoubtedly motivated to speed up its move to EMV technology by the avalanche of negative attention and subsequent hit to its profits caused by the data theft. Still, most security experts believe it’s the right move. EMV technology is a far tougher nut for data thieves to crack than magnetic strip technology, which has long been the security norm in the U.S. Because EMV cards contain a microchip that must be authenticated with a personal identification number – hence the technology’s other name, chip and PIN – they are far less vulnerable to identity fraudsters than magnetic swipes.

In countries around Europe and throughout the globe, the fact that EMV cards are standard has reduced the amount of identity theft significantly. The replacement of magnetic strip technology with EMVs certainly won’t end data theft altogether. As Mulligan noted in his Senate testimony, Target cannot force the whole country to embrace EMVs. It will require broad support from other retailers and card issuers for all U.S. consumers to get the benefit of the elevated protection offered by EMV cards.

March 4, 2014
Hackers Target Walmart MoneyCards

Walmart MoneyCard holders around the U.S. report being swindled

by Chris Warren

It has been a miserable month for a small number of Walmart MoneyCard customers. According to a story on the website ConsumerAffairs.com, a host of Americans who use the retailer’s general purpose reloadable prepaid debit card have had their accounts hacked recently.

In the piece by writer Jennifer Abel, Walmart MoneyCard holders in Missouri, Ohio and California all reported very similar experiences in which a thief in New York City drains victims’ accounts by getting hold of their account information and then making purchases at a Target in Brooklyn. One of the victims, Kelly L. from Canton, Ohio, complained that she checked her account balance on Sept. 9 and discovered that it had just $1.41, thanks largely to 5 purchases made at a Target in New York City the day before. “I am waiting for [Walmart] to send me a new card so I can get the amount owed to me, then I am closing my account,” she wrote.

In a follow-up story on Sept. 18 Abel wrote that Walmart had neither responded to her requests for comment nor resolved any of the earlier cases. Abel did, however, quote the Walmart cardholder policy, which urges anyone who believes their card or PIN has been lost or stolen to notify the company immediately. “You will not lose any part of the money on your card based on unauthorized use if you have exercised reasonable care in safeguarding your Card and PIN from risk of loss or theft,” it says. “However, if these conditions are NOT met, you could lose the lesser of $50 or the amount of unauthorized use from your Card before you notify us that your Card has been lost or stolen.”

In other words, the terms of the cardholder policy give some assurance that those who were victimized by the New York fraudster will get most, if not all, of their money back. But as Abel notes – and as we have reported on in the past – prepaid debit cards offer far less protection than debit or credit cards in the event they are lost or stolen. That said, if you are unfortunate enough to fall victim to a criminal, the most important thing to do is to alert the card issuer right away and continuously follow-up with the company to ensure that you get as much of your money back as possible.

September 23, 2013