Neiman Marcus, Target Data Breaches: 8 FactsA cyberattack campaign, likely coordinated, breached data from Target, Neiman Marcus, and at least three other retailers.
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Neiman Marcus confirmed Friday that it suffered a data breach that extended throughout at least part of December, and which resulted in the theft of an unknown amount of credit and debit card data.
The luxury retailer said it learned in mid-December that its systems may have been compromised. "Neiman Marcus was informed by our merchant processor in mid-December of potentially unauthorized payment card activity that occurred following customer purchases at our Neiman Marcus Group stores," company spokeswoman Ginger Reeder said Monday via email.
In response, the retailer hired a digital forensics investigation firm. "On January 1st, the forensics firm discovered evidence that the company was the victim of a criminal cyber-security intrusion and that some customers' cards were possibly compromised as a result," Reeder said.
Neiman Marcus first publicly detailed the breach Friday, which happened to be the same day that Target updated its data breach notification, revealing that in addition to the 40 million credit and debit cards stolen from the retailer from late November until mid-December, personal information on 70 million customers was also compromised.
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Are the breaches connected? According to a Reuters report on Sunday, investigators now believe that Target, Neiman Marcus, and at least three other retailers -- which have yet to be named -- were successfully breached at the end of 2013, likely all by the same gang.
Here's what's known about this apparent hack-attack campaign against US retailers:
1. Remediation, investigation ongoing at Neiman Marcus
Neiman Marcus said that as soon as it learned of the breach, it brought the appropriate resources to bear to both identify and fix the underlying information security problems, which it declined to identify. "We informed federal law enforcement agencies and are working actively with the US Secret Service; the payment brands; our merchant processor; a leading investigations, intelligence, and risk management firm; and a leading forensics firm to investigate the situation," Neiman Marcus's Reeder said.
One question that Neiman Marcus executives will likely face in coming days is whether they warned breach victims quickly enough. About one month appears to have elapsed between when the retailer first learned that its systems may have been compromised and when it warned its own customers.
On the other hand, the retailer only positively learned two weeks ago that its systems had been breached, and it's still trying to harden those systems against similar attacks. "We have begun to contain the intrusion and have taken significant steps to further enhance information security," spokeswoman Reeder said Monday.
2. Finding solid answers may still take weeks
As Neiman Marcus's breach investigation unfolds, the retailer may find that attackers stole more than card data. Target first disclosed on Dec. 19 that information for 40 million credit and debit cards that it processed had been compromised. On Friday, Target said its investigators discovered that personal information for 70 million of the retailer's customers was also stolen, meaning that up to 110 million consumers may have been affected by the breach.
"There may some overlap between the two groups -- the 40 million and the 70 million -- but we don't know to what extent at this time," Target spokeswoman Molly Snyder said Monday via email, highlighting how the investigation and a full picture of what happened are works in progress.
3. Neiman Marcus will notify affected customers
Like Target, Neiman Marcus has apologized to its customers for the data breach, and the high-end retailer said it also plans to notify anyone that it believes was affected. "The security of our customers' information is always a priority and we sincerely regret any inconvenience," Reeder said. "We are taking steps, where possible, to notify customers whose cards we know were used fraudulently after making a purchase at our store."
But both the Target and Neiman Marcus breaches only came to light after information security reporter Brian Krebs received reports about fraudulent purchases traced to cards used at both retailers. After Krebs publicized the suspected fraud, first at Target in December, and then Neiman Marcus on Friday, both retailers confirmed that they'd been breached.
To date, Neiman Marcus has yet to specify whether, as Target has done, it will offer free ID theft and credit monitoring services to affected customers. Target has stopped short of offering to foot the bill for replacement cards for affected consumers. As a result, not all card issuers plan to send replacements to affected consumers.
4. Neiman Marcus attack timing correlates with Target breach
Target said that its systems were breached from Nov. 27 -- the day before Thanksgiving, and the start of the year's busiest shopping period -- until Dec. 15. Meanwhile, Neiman Marcus said it first learned that its systems were breached in mid-December. Given the apparent overlap in attack times, was the same gang behind both exploits? That's not clear, although investigators who spoke to Reuters on condition of anonymity said that they suspect that a single gang, based in Eastern Europe, was behind the attacks.
Neiman Marcus spokeswoman Reeder declined to respond to an emailed question about whether it was coordinating its breach investigation with Target or any other retailer that might have been targeted by the same set of attackers.
5. Trial runs likely preceded recent attacks
Investigators now believe that the attacks against Target, Neiman Marcus, and other -- as-yet-unnamed -- retailers were preceded by a series of smaller attacks that began a few months before the post-Thanksgiving shopping rush.
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