Britain’s Dixons Carphone suffers cyberattack on customer data

Dixons Carphone issued a profit warning last month. (Bloomberg via Getty Images)
Updated 13 June 2018
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Britain’s Dixons Carphone suffers cyberattack on customer data

  • Attempt in July last year to compromise data on 5.9 million credit cards
  • Shares in Dixons Carphone have fallen 37 percent so far this year

LONDON: British mobile phone and electricals retailer Dixons Carphone has become the victim of a major cyberattack for the second time in three years after discovering unauthorized access to its payment card data.
Shares in Dixons Carphone, which issued a profit warning last month, fell as much as 6.4 percent on Wednesday, taking year-on-year losses to 37 percent.
“We have taken action to close off this access and have no evidence it is continuing. We have no evidence to date of any fraudulent use of the data as result of these incidents,” the company said.
It said an investigation, which started last week, indicated there was an attempt, going back to July last year, to compromise data on 5.9 million credit cards in one of the processing systems of Currys PC World and Dixons Travel stores.
It said 5.8 million of these cards had chip and pin protection and the data accessed contained neither pin codes, card verification values nor any authentication data that would enable cardholder identification or purchases to be made.
However, it said 105,000 non-EU issued payment cards which do not have chip and pin protection had been compromised.
Dixons Carphone said it had immediately notified the relevant card companies so that they could protect customers.
It said it had found no evidence of any fraud on these cards as a result of this incident.
The group said it had also found that 1.2 million records containing non-financial personal data, such as names, addresses or email addresses, had been accessed. It said there was no evidence of fraud here either.
Dixons Carphone informed Britain’s data protection regulator the Information Commissioner’s Office (ICO), as well as the Financial Conduct Authority (FCA) and the police.
The ICO said it was liaising with the National Cyber Security Center, the FCA and other agencies to determine the impact on customers.
The group’s Carphone Warehouse division suffered a data breach in 2015 and in February this year was fined a record matching £400,000 ($533,240) by the ICO. It paid £320,000 as there was a 20 percent reduction for early payment. It said since the 2015 attack it had worked extensively with cybersecurity experts to upgrade its security systems.
In 2016 the ICO fined broadband provider TalkTalk £400,000 for security failings that allowed hackers to launch a cyber-attack in 2015.
“We are extremely disappointed and sorry for any upset this may cause,” Dixons Carphone CEO Alex Baldock said.
“The protection of our data has to be at the heart of our business, and we’ve fallen short here.”
Baldock joined Dixons Carphone in April and last month the group warned on profits and said it would have to close shops, wiping more than £500 million off its stock market value.
Russ Mould, investment director at AJ Bell, said the cyberattack could undermine consumer confidence in the retailer.
“The fact this only came to light now thanks to a review of the company’s systems and data and actually occurred in 2017 is also cause for some concern,” he said.
Because the data breach dates back to last year it will be dealt with by the ICO under the powers of the Data Protection Act 1998 and not the European Union General Data Protection Regulation (GDPR) which went into effect on May 25.
The maximum possible financial penalty under the 1998 Act is £500,000 as opposed to £17 million pounds under GDPR.


Oil prices gain on lower US crude inventories, Libyan output disruption

Updated 20 June 2018
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Oil prices gain on lower US crude inventories, Libyan output disruption

SINGAPORE: Oil prices recovered some day-earlier losses in Asia on Wednesday, supported by a drop in US commercial crude inventories and the loss of storage capacity in oil producer Libya.
US crude inventories fell by 3 million barrels to 430.6 million barrels in the week to June 15, according to American Petroleum Institute (API) in a weekly report on Tuesday.
Brent crude futures rose 18 cents, or 0.2 percent, to $75.26 per barrel at 0351 GMT, compared with their last close on Tuesday.
US West Texas Intermediate (WTI) crude futures gained 20 cents, or 0.3 percent, to $65.27.
Traders said a drop in Libyan supplies due to the collapse of an estimated 400,000-barrel storage tank also helped push up prices.
Looming larger over markets, however, is a June 22 meeting in Vienna of the Organization of the Petroleum Exporting Countries (OPEC) with some other producers, including Russia, to discuss supply.
De-facto OPEC leader and top crude exporter Saudi Arabia, as well as Russia, which is not a member of the cartel but is the world’s biggest oil producer, are pushing to loosen supply controls introduced in 2017 to prop up prices.
Other OPEC-members, including Iran, are against such a move, fearing a sharp slump in prices.
“Saudi Arabia and Russia continued to push for a relaxation in production constraints, going against many other members’ wishes,” ANZ bank said on Wednesday.
“Iran rejected a potential compromise, saying it won’t support even a small increase in oil production. This puts Saudi Arabia in a tough position, as unanimity is needed for any accord to be reached,” it added.
Jack Allardyce, oil-and-gas research analyst at Cantor Fitzgerald Europe, said he had the “expectation that supply quotas will be increased, but probably more in line with the smaller range being quoted (300,000-600,000 barrels per day) given the lack of consensus among OPEC members.”
Allardyce said “we could see this knocking $5 per barrel off Brent and perhaps squeezing the WTI discount a little.”
Markets are also anxiously watching trade tensions between the United States and China, in which both sides have threatened to impose stiff duties on each other’s exports, including US crude oil.
A 25 percent tariff on US crude oil imports, as threatened by China in retaliation for duties Washington has announced but not yet implemented against Chinese products, would make American crude uncompetitive in China versus other supplies.
This would almost certainly lead to a sharp drop-off in Chinese purchases of US crude, which have boomed in the last two years to a business now worth around $1 billion per month.