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TJX lists mounting costs of data-breach debacle




TJX lists mounting costs of data-breach debacle
TJX lists mounting costs of data-breach debacle



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http://www.networkworld.com/news/2007/060807-tjx.html 

By Ellen Messmer
Network World
06/08/07

Retailer TJX yesterday detailed the mounting legal woes and financial 
costs spawning from a data-breach disclosed in January that=E2=80=99s believed 
to have resulted in the compromise of at least 45.6 million credit and 
debit cards.

In its quarterly filing with the Securities and Exchange Commission, TJX 
acknowledged that the computer intrusion still under investigation has 
cost it $20 million during the first quarter alone, and that costs were 
expected to continue to mount in future quarters.

In addition, stated TJX, =E2=80=9CWe face potential liabilities from customers, 
banks, payment card companies and governmental entities with respect to 
the computer intrusion.=E2=80=9D

TJX says it=E2=80=99s facing several =E2=80=9Cputative class-action lawsuits=E2=80=9D filed in 
Massachusetts, Illinois, Ohio and elsewhere. These lawsuits are said to 
represent individuals, financial institutions and others claiming injury 
and shareholder interest associated with the computer intrusion. Some 
lawsuits also name Fifth Third Bancorp as a defendant because it 
processed payment-card transactions for TJX.

TJX is also facing a lawsuit from the Massachusetts Bankers Association 
representing banks pressing to have their losses associated with the 
data breach covered by TJX.

TJX stated in the filing that the $20 million in costs tied to the data 
breach was spent on investigating the security lapse, strengthening 
computer security and communicating with customers about the compromise 
of sensitive financial data.

TJX, which has 125,000 employees, operates hundreds of T.J. Maxx and 
other stores in the United States and the United Kingdom. In the 
quarterly filing, TJX reported net sales for the quarter ending April 28 
were $4.1 billion, up from $3.8 billion the same quarter a year ago. Net 
income for the quarter was down from $163.8 million a year ago to $162.1 
million in the first quarter of this year.

All contents copyright 1995-2007 Network World, Inc


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