Wyndham settles data breach claim with Federal Trade Commission
Wednesday, 10 Dec, 2015
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Hotel chain Wyndham has reached agreement with the US Federal Trade Commission over a long running legal dispute concerning the hotel company’s handling of customer cardholder data.
Under the settlement terms agreed, Wyndham must set up a ‘comprehensive information security program’ for credit car transactions processed in the US.
The FTC first filed a complaint against Wyndham after three separate data breaches occurred at Wyndham hotels.
Wyndham failed to offer customers minimum protections against unauthorized access of personal data and resulted in the compromise of more than 500,000 payment card accounts, the FTC said.
It ‘unreasonably and unnecessarily exposed consumers’ personal data to unauthorized access and theft,’ the FTC alleged.
Wyndham tried to have the action halted, saying the FTC did not have legal authority, but this was dismissed.
"Today’s settlement provides the company’s customers with meaningful protections moving forward," said Jessica Rich, director of the FTC’s bureau of consumer protection.
The hotel group must also provide audited evidence that the security program complies with the Payment Card Industry Data Security Standard each year for the next 20 years.
According to the settlement there are no cash penalties for Wyndham to pay but it could be fined heavily if it fails to abide by the agreed terms in the coming years.
In response a Wyndham statement said: "We chose to defend against this litigation based on our strong belief that we have had reasonable data security in place and that the FTC’s position could have had a negative impact on the franchise business model. This settlement resolves these issues and sets a standard for what the government considers reasonable data security of payment card information."
"We’re pleased to reach this settlement with the FTC. Safeguarding personal information remains a top priority for our company at a time when companies and government agencies are increasingly the targets of cyberattacks," it added.
Has Wyndham got off lightly in this settlement, or has the publicity surrounding this case damaged the company? Let us know your thoughts and post your comments below.
TravelMole Editorial Team
Editor for TravelMole North America and Asia pacific regions. Ray is a highly experienced (15+ years) skilled journalist and editor predominantly in travel, hospitality and lifestyle working with a huge number of major market-leading brands. He has also cover in-depth news, interviews and features in general business, finance, tech and geopolitical issues for a select few major news outlets and publishers.
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