Tesco share price: Cyber attack costs banking unit £2.5m

on Nov 9, 2016
Updated: Oct 21, 2019

Tesco’s (LON:TSCO) banking unit has refunded £2.5 million to 9,000 customers who had money stolen in an attack on their accounts, the lender has said. The challenger bank has resumed full service after the theft which took place over the weekend.

Tesco’s share price, which suffered on Monday following the cyber attack on the group’s wholly-owned subsidiary, has fallen deep into the red today, having shed 2.06 percent to 197.05p as of 10:13 GMT. The stock is underperforming the blue-chip FTSE 100 index which currently stands 0.22 percent lower at 6,828.01 points. The supermarket’s shares have gained more than 10 percent over the past year, and are up by some 30 percent in the year-to-date.

Tesco Bank said in a statement yesterday that around 9,000 customers were affected by the ‘fraudulent transactions’ which took place over the weekend, and that they were reimbursed evening of Tuesday 8 November. The total cost of refunding these customers is estimated to be £2.5 million.
“We’ve now refunded all customer accounts affected by fraud and lifted the suspension of online debit transactions so that customers can use their accounts as normal,” the bank’s chief executive Benny Higgins said in the statement, adding that none of the customers’ personal data had been compromised.

“Smaller and medium-sized companies may be more vulnerable, many of them have not invested properly in security measures and an incident like this should stimulate them to think again,” Sergio Romanets, cyber security expert at consultant Greyspark Partners, told Reuters.
Tesco Bank confirmed that it was continuing to work with authorities. The BBC notes that the National Crime Agency (NCA) is leading the investigation into the case. The National Cyber Security Centre, a new government body, said that it was working with the NCA.
As of 10:48 GMT, Wednesday, 09 November, Tesco PLC share price is 197.25p.

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