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Bank of America sends new cards out after security breach

Bank of America Corp. delivered new debit cards this week to customers whose accounts may have been compromised at a merchant location.  

The biggest U.S. lender by assets, BAC, created the new account numbers as a precaution if fraud monitoring detects potential security breaches, Betty Riess, a spokesperson for the Charlotte, North Caroline-based company said, Bloomberg.com reports.

Reiss said the company’s actions were the result of an isolated incident.

“This would’ve been a compromise at a third-party merchant location, it had nothing to do with a security breach of Bank of America’s system,” Riess said, according Bloomberg.com. “If we believe that a customer’s card may have been compromised, we’ll notify the customer and block and re-issue the card.”

The cost related to debit and credit card fraud continues to rise as electronic forms of payment replace cash and checks.

Leigh Williams, the president of BITS, the technology policy of the Washington-based Financial Services Roundtable, said that financial firms are spending “tens of billions of dollars” to protect consumer data.

“New technologies have greatly expanded the ways we access information and conduct day-to-day business, but these new tools also pose new security challenges that we must address as a nation,” Sen. Roy Blunt (R-Mo.) said.

Blunt recently co-sponsored the Data Security Act of 2011, which would require entities such as financial establishments, retailers and federal agencies to safeguard sensitive information, investigate security breaches and notify consumers when there is a substantial risk of identity theft or account fraud.

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