Retail associations have accused CUNA and NAFCU of using misleading arguments on data security in the media and before Congress.

The Retail Industry Leaders Association, National Retail Federation, National Association of Convenience Stores and other organizations wrote CUNA and NAFCU to dispel what they described as misconceptions about retailers' response to cyber attacks.

The retail groups said data breaches do not disproportionately affect retail merchants.

“When the 2014 Verizon Data Breach Investigations Report analyzed 1,367 data-loss incidents last year, they found that 465 (roughly 34%) took place at financial institutions, while fewer than 150 (less than 11%) affected retailers,” read the letter sent Thursday.

The retail trade groups also said retailers share some of the costs incurred by credit card fraud, citing a 2013 Federal Reserve study that examined debit card fraud instances. Retailers also contribute to the costs of issuing new cards to consumers after a data breach, the groups noted.

Merchants spend more than $6 billion each year on data security measures, the retailer organizations wrote.

They criticized credit unions for not adopting chip and pin technology within the timelines set by the financial industry.

In response to the letter, NAFCU President/CEO Dan Berger said, “We will join their partnership when retailers and merchants begin properly protecting consumers' data and investing in the technology necessary to do so.”

CUNA President/CEO Jim Nussle said data breaches at The Home Depot and Target have cost credit unions and their members a minimum of $90 million.

“With the many other breaches that have also occurred – at Staples, Neiman-Marcus and others – certainly credit unions have incurred millions more in costs this year,” he said in response to the letter.

A CUNA survey found that credit unions have not received reimbursements for the Target breach.

“In short, we'll back off highlighting the costs of data breaches on credit unions when merchants step up and take responsibility, adopt the same data standards, and stop making consumers vulnerable,” Nussle said.

Instant Insights /

Retail Groups Attack CUNA, NAFCU on Data Security

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