The JPMorgan Chase Ucard breach reported previously on this blog affects residents of numerous states. As such, not only do I expect to see lawsuits filed, but state attorneys general will likely jump into the act to protect their respective residents. Did JPMorgan Chase promptly notify their residents and are they offering enough remediation and support? Some may argue that they haven’t in light of media reports that affected cards are not being replaced, and states will be negotiating/posturing to get more for their residents.
Here’s a statement from Connecticut’s State Treasurer. Some snippets that show which way the wind may be blowing:
My office has been advised by JPMorgan Chase that during the two-month period between July and September, certain information entered by cardholders on the UCard website — particularly during the process of activating cards and of transferring balances — was subject to unauthorized access. Such information that could have been exposed includes: name, social security number, bank account number, card number, date of birth, security answer, password, address, phone number and e-mail address.
[…]
While JPMorgan Chase represents that it has found no evidence of improper activity on these accounts since September, as a precaution – and at our direction – the company is notifying all affected cardholders that it will provide them two years of credit monitoring free of charge. Nonetheless, I am dismayed that JPMorgan Chase delayed informing my Office of this security breach for two and a half months — from mid-September, when they first learned of it, until this week. They should have picked up the phone immediately and called us. That the company failed to communicate this security breach in a timely manner raises concerns over its culture of compliance and broader governance issues.
Upon learning of this data breach on Tuesday, my Office promptly informed all state agencies affected, and we are now working with JPMorgan Chase to ensure that all affected cardholders are notified immediately. The company will explain to cardholders what specific personal information may have been compromised. My office also has been in contact with Attorney General Jepsen’s office, and has been advised that his office’s privacy task force was recently notified of the breach and will be looking into it.
Note the text I emphasized above. Connecticut insisted JPMorgan Chase offer two years of free credit monitoring. When Louisiana disclosed the breach (they were the first state to issue a statement), they said their residents will be getting one year of free credit monitoring. Will Louisiana now go back to JPMorgan Chase and insist on two years? Will other states? And will some state attorneys general attempt to impose monetary penalties on Chase for failing to notify more promptly?
Oh yeah, this is going to be an expensive breach for JPMorgan Chase….
Update: Here’s the the template for JPMorgan Chase’s notification letter to those affected (pdf). If the hacker accessed passwords & JPMorgan Chase isn’t re-issuing Ucards, it’s odd that they just “recommend” people change their passwords.
The compromise can be fully blamed on the following two facts : [1] the compromised servers resided in ESF which is Tier 3 within the JPMC network architecture – in other words, high exposure risk and [2] the employment of Open Source software which, despite voiced reluctance from related internal teams, was installed at the behest of architects and Global Technology (GTI).