Home Depot agrees to pay $19.5 million to settle a class-action lawsuit that a massive data breach in 2014 caused. The incident affected more than 56 million customers, exposing the credit card information of everyone caught up in the whole matter.
The retailer's plans include setting aside a $13 million fund to compensate consumers for out-of-pocket losses and allocate $6.5 million for at least 18 months of identity protection services for cardholders.
As part of the safeguarding effort, Home Depot is looking into hiring a chief information security officer to lead the company's push to considerably improve data security in the span of two years.
It should also be noted that Home Depot says that it's not admitting liability with the settlement offer, which requires court approval.
"We wanted to put the litigation behind us, and this was the most expeditious path. Customers were never responsible for any fraudulent charges." Stephen Holmes, a spokesperson for the home-improvement retailer, says.
Using custom-built malware and the login credentials of a third-party vendor, the hackers were able to infiltrate the computer network, gaining access to customers' credit card information. The breach took place between April and September 2014.
The intruders placed the malware in the self-checkout machines of Home Depot in the United States and Canada, and that's how they stole the personal and sensitive details.
Aside from the credit card information, 53 million email addresses were compromised as well.
This incident is comparable to the hack into another retailer Target back in 2013. It also exposed the credit card information of about 40 million customers and the personal data of approximately 70 million others. Target agreed to pay $10 million to settle the lawsuit.
However, the case of Home Depot is among the largest ones that ever occurred, which is obvious enough based on the figures alone.
Roughly 57 class-action lawsuits were proposed and filed to courts in the United States and Canada because of the data breach involving Home Depot.
