Retailer TJX Companies announced last week in its earning statements that recovering from the online intrusion of its processing networks that resulted in the theft of data on at least 45.6 million credit and debit cards cost the company $12 million in the last quarter, bringing the firm's total to date to $17 million.
The costs include investigating the incident, upgrading the company's network security, communicating with its customers, and legal fees, TJX said in a statement. The charges occurred in the first quarter of the company's 2008 fiscal year ending April 28. The firm expects a similar charge in its second quarter.
"Beyond these costs, TJX does not yet have enough information to reasonably estimate the losses it may incur arising from this intrusion, including exposure to payment card companies and banks, exposure in various legal proceedings that are pending or may arise, and related fees and expenses, and other potential liabilities and other costs and expenses," the company stated.
The retail giant has come under fire since first announcing that its lax security resulted in the theft of at least 45.6 million credit-card and debit-card numbers. The breach has resulted in significant credit card fraud, including fueling a scheme in Florida that cost businesses at least $8 million. A group of New England banks have sued the company for the cost of replacing debit cards whose accounts were compromised by the theft.
TJX has stated that it may never be able to fully identify the number of cards compromised by the theft.
Posted by: Robert Lemos