The historic hack went on over a five-month period and it’s presumably leaving banks, The Home Depot, Inc. (NYSE:HD) and its customers asking how could this have happened especially over five months.
While the announcement doesn’t come as a shock by any means with many writing that the breech could ultimately exceed the 40 million customers whose information was stolen at Target Corporation (NYSE:TGT), it is the first time that The Home Depot, Inc. (NYSE:HD) has released the sheer size of the attack. The company also announced that the “custom-made” malware had finally been removed from all the terminals that were infected.
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Won’t have Target ramifications
While the Target Corporation (NYSE:TGT) attack forced the resignation of its CEO, don’t expect a repeat there. The attack began when The Home Depot, Inc. (NYSE:HD) was being led by Frank Blake who will be stepping down as CEO on November 1 after having enjoying enormous success at the DIY-retailer. He will be replaced by Craig Menear.
Home Depot announced yesterday that its project to fully encrypt payment terminal data has been completed. Following the massive breaches above and attacks on luxury retailer Neiman Marcus Group Ltd. and grocer Supervalu Inc. (NYSE:SVU) as well as P.F. Chang’s China Bistro (NASDAQ:PFCB), it’s clear that the United States has a long ways to go in order to protect customers’ payment information.
Prior to the recent acknowledgment of the scope of the breech, JPMorgan Chase & Co. (NYSE:JPM) had already begun to replace the cards of customers affected by the attack. On Wednesday night, Capital One Financial Corp. (NYSE:COF) announced that it too would begin card replacement.
Any positives for Home Depot?
If there are any positives that The Home Depot, Inc. (NYSE:HD) can take away from the attack, I supposed they could be heartened by the fact that hackers had to create “unique, custom-built malware” in order to pull of the hack.
Outgoing CEO, Frank Blake, apologized for the breach and made sure that Home Depot’s customers knew that they would not be responsible for any fraudulent charges that came as a result of the attack. The retailer is still looking at a large loss from the breach and estimated the investigation, credit monitoring service, call center staffing and other steps would cost $62 million to the retailer but nearly half of that amount would fall to its insurers.
To put that in perspective, The Home Depot, Inc. (NYSE:HD) did $43.5 billion in sales in its first two quarters this year and is expecting sales to keep growing with a strengthened housing market.