Target: Shoppers' Encrypted PINs Stolen in Massive Card Hack

Minneapolis-based Target says it is still in the early stages of investigating the breach.

By Barbara Ortutay and Mae Anderson
|  Friday, Dec 27, 2013  |  Updated 5:54 PM PDT
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The hackers who attacked Target Corp. and compromised up to 40 million credit cards and debit cards also managed to steal encrypted personal identification numbers (PINs), according to a senior payments executive familiar with the situation. Scott Budman reports.

The hackers who attacked Target Corp. and compromised up to 40 million credit cards and debit cards also managed to steal encrypted personal identification numbers (PINs), according to a senior payments executive familiar with the situation. Scott Budman reports.

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Target said Friday that debit-card PINs were among the financial information stolen from millions of customers who shopped at the retailer earlier this month.

 

The company said the stolen personal identification numbers, which customers type into keypads to make secure transactions, were encrypted and that this strongly reduces risk to customers. In addition to the encrypted PINs, customer names, credit and debit card numbers, card expiration dates and the embedded code on the magnetic strip on back of the cards were stolen from about 40 million credit and debit cards used at Target stores between Nov. 27 and Dec. 15.

Security experts say it's the second-largest theft of card accounts in U.S. history, surpassed only by a scam that began in 2005 involving retailer TJX Cos.

"We remain confident that PIN numbers are safe and secure," spokeswoman Molly Snyder said in an emailed statement Friday. "The PIN information was fully encrypted at the keypad, remained encrypted within our system, and remained encrypted when it was removed from our systems."

However, Gartner security analyst Avivah Litan said Friday that the PINs for the affected cards are vulnerable and people should change their codes since such data has been decrypted, or unlocked, before. In 2009 computer hacker Albert Gonzalez pleaded guilty to conspiracy, wire fraud and other charges after masterminding debit and credit card breaches in 2005 that targeted retailers such as T.J. Maxx, Barnes & Noble and OfficeMax. Gonzalez's group was able to unlock encrypted data. Litan said changes have been made since then to make decrypting more difficult but "nothing is infallible."

"It's not impossible, not unprecedented (and) has been done before," she said.

Besides changing your PIN, Litan says shoppers should instead opt to use their signature to approve transactions because it is safer. Still, she said Target did "as much as could be reasonably expected" in this case.

"It's a leaky system to begin with," she said.

Credit card companies in the U.S. plan to replace magnetic strips with digital chips by the fall of 2015, a system already common in Europe and other countries that makes data theft more difficult.

Minneapolis-based Target Corp. said it is still in the early stages of investigating the breach. It has been working with the Secret Service and the Department of Justice.

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