Heartland and MasterCard Reach Settlement
Credit union MasterCard issuers will likely be among the financial institutions that will share in a settlement between Heartland Payment Systems and MasterCard over the firm's 2008 data security breach.
The payment's processing firm experienced a card data security breach in 2008 that continued for months, which the firm made public in January 2009. Some card security experts consider it the largest card security breach in history, though the company has never publicly announced how many card accounts were actually compromised.
Under the settlement, alternative recovery offers totaling $41.4 million will be made to eligible MasterCard issuers with respect to losses alleged to have been incurred by them as a result of the criminal intrusion, and MasterCard will recommend that eligible MasterCard issuers accept such offers, the company said when announcing the settlement.
"We are pleased to have reached an equitable settlement agreement that helps issuers of MasterCard-branded cards obtain a recovery with respect to losses they may have incurred from the intrusion. We look forward to working with MasterCard to encourage these issuers to participate in the settlement program for a speedy resolution," said Bob Carr, Heartland CEO.
As with the settlement the firm reached with VISA Inc, this agreement is contingent upon financial institutions representing 80% of the claimed-on MasterCard accounts accepting their alternative recovery offers by June 25, 2010. Also like the Visa settlement, any credit unions that accept the MasterCard settlement will have to waive any other claims against the processor.
The company said all eligible issuers will soon receive notification from MasterCard with full details of the settlement agreement and how to accept their alternative recovery offers before the offers expire.