[BreachExchange] A.G. Schneiderman Announces $100K Settlement With E-Retailer After Data Breach Exposes Over 25K Credit Card Numbers

[Audrey McNeil]

http://www.pressreleasepoint.com/ag-schneiderman-announces-
100k-settlement-e-retailer-after-data-breach-exposes-over-25k-credit-card

Attorney General Eric T. Schneiderman today announced a settlement with
Provision Supply, LLC, d/b/a EZcontactsUSA.com, involving a data breach
resulting in the potential exposure of over 25,000 credit card numbers and
other cardholder data.  EZcontactsUSA.com has agreed to pay $100,000 in
penalties and to shore up its data security practices.

“New Yorkers deserve an Internet marketplace that secures their personal
information,” said Attorney General Schneiderman. “No one should be exposed
to identity theft or financial fraud by simply buying something over the
Internet. My office will continue working to help protect hardworking New
Yorkers from credit card fraud.”

On August 7, 2014, a third party infiltrated EZcontactsUSA.com website,
which is based in Brooklyn, New York.  On June 05, 2015,
EZcontactsUSA.com's merchant bank notified it that fraudulent charges were
appearing on customer credit card accounts. Shortly thereafter,
EZcontactsUSA.com engaged a company to conduct a forensic investigation,
which discovered and removed all the malware on the EZcontactsUSA.com
website.

EZContactsUSA.com never provided notice to its customers or law enforcement
about the breach, in violation of General Business Law § 899-aa, which
requires notice be provided to affected individuals and various government
agencies including Schneiderman’s office, in the most expedient time
possible and without unreasonable delay.

Schneiderman’s office also found that EZContactsUSA.com violated Executive
Law § 63(12) and General Business Laws §§ 349 and 350 by misrepresenting
the safety and security of its website.  EZContactsUSA.com advertised its
website as “100% safe and secure,” and “utilizing the latest security
technology available.” However, a forensics investigation revealed that
EZcontactsUSA.com’s website contained numerous security vulnerabilities. In
particular, the investigation revealed that EZcontactsUSA.com did not
maintain a written security policy addressing information security
problems; deploy effective web server and host based firewall
configurations designed to prevent unauthorized access and exploitation of
commonly known vulnerable outgoing computer network port(s); implement
anti-virus and anti-malware software on any computer systems; monitor
and/or review the site’s performance and security configuration, or
otherwise conduct vulnerability and penetration testing; or maintain
firewall logs, which prevented investigators from determining the frequency
of attacker visits and related information.

The settlement requires EZcontactsUSA.com to conduct thorough and
expeditious investigations of any future data security breaches, provide
prompt notice of data security breaches to affected New York residents and
to New York law enforcement, maintain reasonable security policies and
procedures designed to protect the personal information of consumers in
accordance with New York State General Business laws, and to remediate the
many security vulnerabilities contained in its website. EZcontactsUSA.com
must also train employees with the most up-to-date data security practices,
and pay a $100,000 penalty.

This case was handled by Bureau of Internet and Technology Deputy Bureau
Chief Clark Russell and Resident Technologist Marc Kowtko. The Bureau of
Internet and Technology is led by Bureau Chief K
-------------- next part --------------
An HTML attachment was scrubbed...
URL: <http://lists.riskbasedsecurity.com/pipermail/breachexchange/attachments/20160805/8480fa73/attachment.html>