Yesterday, HEI Hotels and Resorts, a company that manages hotels operating under brand names such as Marriott, Hyatt and InterContinental, announced that 20 of its hotels suffered a data breach that resulted in hackers stealing customer names, credit and debit card account numbers, expiration dates and three digit verification codes for tens of thousands of transactions going back as far as March of 2015.
It is not known yet whether the data breach is related to the hacking by the Russian organized crime group Carbanak, that, as reported recently by Brian Krebs managed to install malware into the credit and debit card processing equipment manufactured by MICROS used in hotels around the world.
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 HEI’s 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.
Here is a link to which you can go to find out which hotels were affected by the data breach and when the data was compromised. http://www.heihotels.com/list-of-properties