Kimpton Hotels, a chain of 62 boutique hotels is looking into a possible data breach, which essentially means that they were indeed hacked and they are just trying to confirm this fact. Almost in every instance when companies are hacked, it is the credit and debit card processors that notice a pattern of fraudulent card use and then trace it back to the hacked companies, which in this instance appears to have occurred in almost half of the Kimpton hotels in the United States. When this is confirmed, Kimpton will just be the latest of a long line of hotels including Omni Hotels and Resorts, Hyatt, Hotels, Starwood Hotels, Hilton Hotels and Trump Hotels (twice) that all suffered similar data breaches in the last year in which credit card and debit card information of their customers was stolen by unknown hackers.
The primary reasons for the continuing problem of data breaches at hotel chains are the weak cybersecurity of many hotel chains coupled with these companies still using credit card and debit card processors for cards with magnetic strips rather than the safer smart EMV chip cards. Regulations effective October 1, 2015 mandated credit card issuers and retailers switch over to the new smart EMV chip cards or risk increased legal liability, but unfortunately, many companies have been slow to switch to the new card processing equipment. If smart EMV chip cards had been used at Kimpton Hotels, the card information that was stolen would have been worthless, but since they still used the old fashioned magnetic strip cards, Kimpton and its customers face financial problems from this data breach.
Until credit card issuing companies and brick and mortar stores and businesses that take credit cards switch to the new smart EMV chip cards, this story will, as I predicted more than a year ago, continue to occur again and again. As for us, as consumers, the best we can do is to refrain from using our debit cards for anything other than an ATM card because consumers whose debit card security has been breached are not protected as much as when a credit card is used for fraudulent purchases. In addition, if you do not already have a new smart EMV chip card, you should demand one from your credit card company. You also should regularly monitor your credit card statements for indications of fraudulent use.