June 28, 2005

            LANSING -- Attorney General Mike Cox announced today he is demanding CardSystems Solutions, Inc., an Arizona-based credit card processing company whose computer system was recently penetrated by data thieves, to notify affected Michigan cardholders and help them take steps to avoid becoming victims of identity theft.

            “The breadth of this breach and the fact the company should not have been retaining the sensitive data compromised, makes this breach particularly egregious,” said Cox. “Michigan consumers should be informed so they can take the proper steps to protect their identities.”

            The security breach, which exposed 40 million cardholders to a risk of fraud, was caused by the installation of a rogue computer program that could extract data from the system. The number of Michigan cardholders affected is currently unknown, but under investigation.

            “Other crooks are likely to try to take advantage of the publicity this breach is receiving by claiming to provide assistance in protecting citizens if they reveal personal information,” said Cox. “Consumers should not respond to e-mails claiming to originate from CardSystems Solutions, Inc. or any other company asking for personal information.”

            Consumers should take proactive steps that include promptly and thoroughly checking all statements and bills, and periodically checking credit reports for suspicious transactions. Since March 1, 2005, Michigan residents have been entitled to one free credit report each year from each of the three national credit reporting agencies. To maximize ongoing protection, Cox suggests consumers order a report from one of the three different agencies every four months.

            Two Consumer Alerts, “Free Annual Credit Reports – What Consumers Should Know,” and “Identity Theft Information for Michigan Consumers – 2005 Update” provide consumer protection tips and specific updates on recent changes to Michigan law. Consumers can obtain these alerts online at www.michigan.gov/ag, or can request a copy from the Attorney General Consumer Protection Division toll-free hotline at 1-877-765-8388.

            The free annual credit reports are available only through the centralized source set up by the three credit reporting agencies. If consumers contact the companies directly, they will still be charged for their credit reports. Consumers can obtain their free credit reports by calling 1-877-322-8228, by going online at www.annualcreditreport.com, or completing the Annual Credit Report Request Form, which is available at the Attorney General’s Web site.               

            During 2003 and 2004, the Consumer Protection Division collected more than $600 million on behalf of Michigan. In 2004, the Division stopped more than $400 million in utility rate increases and responded to more than 102,000 consumer complaints.

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