Most corporate credit card data theft happens at the database level, like the massive T.J. Maxx breach. But Hannaford has notified investigators that the recent theft of 4.2 million accounts was caused by malware that was installed on the servers at each of its 300 locations. The software “intercepted data from customers as they paid with plastic at checkout counters and sent data overseas,” reports CNET.
The breach appears to be one of the first in which credit card numbers were stolen while the information was in transit, or at the point of sale. One of a growing number of sophisticated attacks, it illustrates vulnerabilities in the communication between cash registers and branch servers, as Neal Krawetz of Hacker Factor Solutions has warned in research (PDF).
Andrew Conry of InformationWeek adds that Hannaford, in addition to the breach, has two related class action lawsuits on its hands alleging negligence in maintaining customer security. And he suggests that there might be some truth to the claims, noting that Hannaford should have noticed that “internal servers were transmitting outside the network to a strange IP. This should’ve raised flags somewhere–server logs, IDS logs, firewall logs.”