Home Depot recently filed a report with the Securities and Exchange Commission, saying that it is facing at least 44 civil lawsuits in the U.S. and Canada as a result of the data breach that occurred earlier this year.
An unknown entity gained entrance to the systems in April with a stolen password, and 56 million customer credit card accounts were compromised as a result of the breach. Additionally, 53 million customer email addresses were stolen, exposing shoppers to phishing schemes and identity theft.
In the filing, the company warned that the lawsuits and external investigations “may adversely affect how we operate our business, divert the attention of management from the operation of the business and result in additional costs and fines.”
Home Depot has already lost $28 million in pretax expenses to cover legal penalties, litigation fees, investigation costs and the expenditure necessary for credit card fraud reimbursement and credit card reissuance.
The company has previously admitted that it could have done more to protect itself from data breaches. Now, all American stores are outfitted with advanced technology ensuring that all information is encrypted as it passes through point of sale terminals. The Canadian stores are expected to be updated with the same system by early next year.
Additionally, Home Depot reported that it plans to transition the U.S. stores to EMV chip-and-PIN technology, which makes it more difficult for hackers to lift card information.
It’s important to take a close look at the point of sale computer systems your company is currently utilizing, especially as the holiday season approaches and the number of transactions completed each day is likely to skyrocket. Data breaches can be extremely damaging and have long-term effects on both the business and customers, so it’s worth your while to ensure you’re using only the most secure system.