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97 of Visa issuers opt in on Heartland settlement
PRINCETON, N.J., and SAN FRANCISCO (2/5/10)--Financial institutions representing more than 97% of eligible Visa-branded debit and credit cards that incurred losses in the Heartland Payment System data breach have accepted a $60 million settlement Visa Inc. made with Heartland and its sponsoring acquirers regarding losses in the breach. Visa and Heartland needed issuers of 80% of eligible cards to meet the settlement requirement. The settlement provides these card issuers with a recovery from Heartland on the losses they incurred related to the breach. They can expect their recovery amounts from the settlement by Feb. 25, according to the agreement. Each accepting issuer will irrevocably waive Heartland, its sponsor banks and Visa from further claims related to and arising from the breach. Those institutions that did not opt in to accept the settlement offer and who are eligible due to losses from the breach will have a second chance at recovery. Visa, Heartland and Heartland's sponsoring acquirers have agreed to renew the Alternative Recovery Officer to the non-accepting issuers. The renewed offer will remain open until 5 p.m. PST on Monday. The settlement provides recovery for U.S. card issuers who chose to participate in the program and international issuers of accounts Visa considered to have been placed at risk of compromise. Once all the remaining conditions of the settlement have been met, Visa will notify the participating issuers with details about the payment process. For additional information, issuers can contact their Visa account executive or Visa's E-Support Team at or call 888-847-2488. Heartland has entered into two other settlement agreements--a $3.6 million agreement with American Express and an agreement for up to $2.4 million in a consumer cardholder class action lawsuit (News Now Dec. 21 and 29). No settlement has been announced in a similar dispute with MasterCard over the breach. Breaches at Heartland and Hannaford Bros. grocery chain were the largest in history, affecting 130 million cardholders. Credit unions were among the financial institutions re-issuing cards that were compromised by the intrusions and some saw fraudulent transactions on the compromised cards. Fraudsters are still testing and successfully accessing credit and debit card numbers that were not blocked or canceled in the Heartland breach, CUNA Mutual Group said in January (News Now Jan. 12).
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