TJX Offers Settlement in Aftermath of World’s Largest Data Breach
TJX is offering settlement terms:
In an attempt to reach a settlement with customers over a massive data breach, TJX Companies is offering to reimburse people for the cost of replacing their driver’s licenses, three years of credit monitoring, and three-day, 15%-off sale. The company announced the plan in an online advisory, noting that it’s subject to court approval.
TJX, which is the parent company of retailers such as T.J. Maxx, Marshalls, and HomeGoods, announced early this year the loss of more than 45 million credit and debit card numbers that were stolen from its IT systems over an 18-month period. It’s considered to be the largest customer data breach on record.
In August, the company reported in its second-quarter earnings that the company had to absorb a $118 million charge related to the massive security breach. For the second quarter, which ended July 28, the breach cost 25 cents per share — 10 times more than the 2 cents to 3 cents per share company executives estimated just three months ago.
The Motley Fool considers this a “crafty settlement:”
TJX’s settlement includes two interesting features. For customers that shopped at TJX department stores during the affected period, the company is offering vouchers to cover “costs as a result of the intrusion.” The vouchers are good for use at local TJX stores. As you might guess, a relatively small denomination voucher is a great way to get shoppers into a store and potentially spend more than the value of the voucher. Another piece of the settlement is a future event at TJX stores that will give across-the-board savings of 15%. Far from a specific “result of the intrusion” event, this sale will be open to all customers.