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Michigan Credit Union League

Pennsylvania's First Choice Federal Credit Union Files Lawsuit Following Data Breach

The latest battle between credit unions and merchants over data breach responsibility started this week when First Choice Federal Credit Union, based in New Castle, Pennsylvania, filed a class-action lawsuit against WaWa, a chain of more than 850 total convenience stores spread across Pennsylvania, New Jersey, Delaware, Maryland, Virginia, Florida and Washington, D.C.

First Choice’s lawsuit alleges that a data breach exposed data, including credit and debit cardholder names and information, for no less than nine months ending Dec. 12, 2019. As a result, much like Michigan credit unions have had to do following the breaches at Wendy’s, Home Depot and others, credit unions where members were affected by the breach at WaWa (which is located in some areas where Michigan credit unions operate and have members) have been forced to replace member cards and cover fraudulent purchases.

“Despite widespread publicity and industry alerts regarding these other notable data breaches, WaWa failed to take reasonable steps to adequately protect its computer systems from being breached,” read First Choice’s claim.

Following the large-scale security breaches at retailers including Target, Kmart, P.F. Changs and others, CUNA and state leagues have been engaged with advocacy efforts to keep retailers responsible.

There have been victories, such as the $25 million settlement fund Home Depot was required to make following their security breach, but the credit union movement will continue to seek legislative progress to protect financial institutions in the case of data breaches.

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2020-01-16 00:00:00