Schnucks security breach expensive for local banks

A security breach involving Schnucks customers' credit and debit cards could get expensive for some local financial institutions.

Schnucks' Cape Girardeau location, 19 S. Kingshighway, was among 79 stores affected by the breach that came to light March 28, company spokesman Paul Simon said.

Many local banks took a proactive approach in the wake of the breach, contacting potentially affected customers and replacing their cards as a matter of course.

Alliance Bank, The Bank of Missouri, Cape Regional Credit Union, First Missouri State Bank, and U.S. Bank are among the area financial institutions that have replaced customers' cards.

"It is time-consuming on our part, it is work on our part ... and we have a cost involved, but it's what we're doing," said Jim Cauble, president of Cape Regional Credit Union, which replaced about a fifth of its customers' cards. "You don't want to take the chance [on someone's account being compromised], because it can be a nightmare, not only for the individual, but it can be a nightmare for the financial institution. ... The financial institution is who actually takes it on the chin."

First Missouri State Bank is giving customers two weeks to receive and activate new cards before the old ones are canceled, said Brittney Lee, vice president of sales and marketing at the bank.

"We don't want to leave anybody stranded," she said.

The bank has reissued a little more than 300 cards, Lee said.

"We get charged -- we have to pay a couple of dollars for each card we issue, and we have to pay a little over $1 to ... turn it off," she said.

"The banks are incurring some expenses because of negligence on behalf of the merchant," she said.

Both institutions are tracking their expenses and will decide how or whether to seek reimbursement once the totals are in, Cauble and Lee said.

How many local Schnucks customers were affected remains unknown, but Simon said the Cape Girardeau store may have been affected between Dec. 1 and Feb. 2.

The grocer has estimated the breach affected up to 2.4 million customers companywide.

Simon said he was not sure who would absorb the costs associated with the breach.

"It's something that as we go forward here, we will be looking into," he said.

epriddy@semissourian.com

388-3642

Pertinent address:

19 S. Kingshighway, Cape Girardeau, MO