Mastercard Breach Shows Third Party Security Is Priceless

Reports of a data breach against Mastercard began surfacing in Germany early last week with Sueddeutsche Zeitung (in German) one of the first news outlets to report on the loss. As is often the case in major corporate breaches, the company was slow to react officially. On Monday it said only that it was aware of an “issue”. The next day the company had someone to blame: a third-party provider it said had lost data which included usernames, addresses and email addresses, but no credit card details.  

By Wednesday however this statement was proved incorrect when persons unknown uploaded an Excel file with full credit card numbers to the Internet, without CVV or expiration numbers. However, a credit card number with names and addresses is still a highly valued and dangerous item on the dark web. It took until the end of the week before Mastercard admitted that 90,000 customers had been affected and reported the incident to the German Data Protection Authority (DPA). Mastercard confirmed a third party running its German rewards program Priceless Specials had been attacked.

The company said that the breach had no connection to Mastercard’s payment transaction network, and it was “taking every possible step to investigate and resolve the issue,” including informing and supporting cardholders. The company shut down the German Specials website.  

There are two lessons from this breach. It took Mastercard five days to fully admit it had been attacked. Not only does this potentially contravene GDPR which requires 72 hours, but more importantly left its customers without any information and unsure of their exposure. This suggests a failure or absence of incident response management policies and processes at Mastercard, which should be put into action at first sign of a potential breach. It cannot be emphasised enough that companies must scrupulously prepare for disaster and incidents, including PR and executive response strategies to avoid telling conflicting stories.

Secondly, the fact that the breach occurred at a service provider proves once again that oversight and due diligence are essential when confidential data is at stake. GDPR quite clearly states that the data controller remains responsible for a breach from a third-party provider. And this case is a perfect example of how Mastercard may be judged to have failed in this regard when the DPA investigates.


Related Events

Cybersecurity Leadership Summit 2019

Conference

Cybersecurity Leadership Summit 2019

Humboldt Carré, Berlin

Discover KuppingerCole

KuppingerCole PLUS

Get access to the whole body of KC PLUS research including Leadership Compass documents for only €800 a year

KuppingerCole Select

Register now for KuppingerCole Select and get your free 30-day access to a great selection of KuppingerCole research materials and to live trainings.

Stay Connected

Blog

Spotlight

AI for the Future of your Business Learn more

AI for the Future of your Business

AI for the Future of your Business: Effective, Safe, Secure & Ethical Everything we admire, love, need to survive, and that brings us further in creating a better future with a human face is and will be a result of intelligence. Synthesizing and amplifying our human intelligence have therefore the potential of leading us into a new era of prosperity like we have not seen before, if we succeed keeping AI Safe, Secure and Ethical. Since the very beginning of industrialization, and even before, we have been striving at structuring our work in a way that it becomes accessible for [...]

Latest Insights

How can we help you

Send an inquiry

Call Us +49 211 2370770

Mo – Fr 8:00 – 17:00