Bank Accounts Compromised After Michaels Breach

The Michaels Stores security breach that occurred between February and May continues to plague customers. Now the company is saying that seven of their Colorado stores experienced tampering with their payment PIN pads and consumers debit card information was potentially compromised. Additionally, some shoppers say their bank accounts were recently hacked.

After notification of the Michaels security breach in May, customer Eveline Lewis did not experience any problems with her accounts until this weekend when she was notified by her bank that there was unusual activity on her account. Thieves were using an ATM in California to make repeated withdrawals of cash. "They were taking out $83 at a time," Lewis said, "and then there was a $1.50 processing fee from the ATM."

A few hours later she received a phone call alerting her that money was withdrawn from another one of her accounts. Lewis stated that she used both debit cards at the Michaels craft stores, which led her to believe that she was a victim of the recent security breach.

Five Oregon Community Credit Union branches in Eugene and Springfield stayed open over the weekend to help customers whose credit union debit cards were suddenly canceled because of fraudulent activity believed to be related to a security breach at Michaels craft stores, according to The Register-Guard.

"You may have heard the recent news stories about numerous reports of fraudulent activity on bank accounts," the credit union said on its website over the weekend. "Many of our members have been impacted. As a precaution, we are in the process of closing debit cards for impacted members."

The credit union said it is mailing new cards to all affected customers. The credit union has directed consumers to contact them if they have received unsolicited e-mails concerning fraudulent behavior on their accounts. Police and local banks have reported dozens of calls from concerned consumers after the breach.

While investigators believe that most of these consumers were affected by the Michaels breach, the credit union has advised users to beware of a recent phishing scam. Fraudulent e-mails, texts, and phone calls claiming to represent Summit Bank may also be attempts by thieves to get additional personal information from the victims.

Police are not sure how the PIN pads were tampered with, but it is possible that the hackers placed card skimmers onto the store devices. These card skimmers read the magnetic strips of credit and debit cards, and are usually accompanied with miniature cameras that record the user´s PIN.

Doug Marker, Vice President of Loss Prevention and Safety at Michaels, said, "As our investigation continues, we are working with banks and card issuers to determine which unauthorized transactions are related to the PIN pad tampering and which are not. It cannot be assumed that all fraud experienced by any Michaels shopper is necessarily connected to Michaels. We continue to encourage anyone who has experienced fraudulent transaction, related or not, to work directly with their bank and card issuer to protect their account. We are continuing to update Michaels.com with new information as it becomes available."

Michaels has since identified a total of 90 PIN pads that may have been tampered with. In an attempt to regain customer trust, Michaels has removed 7,200 PIN pads from its stores nationwide that were similar to the ones that were hacked. They are being replaced with tamper-proof ones instead. Customers who are concerned about their accounts should contact 1-800-MICHAELS for further information. 

 

Article published by: American Chronicle