What Happens to Stored Credit Card Numbers When a Business Goes Under? (And, Should You Worry?)Submitted by Cornerstone Investment Services, LLC on August 1st, 2016
It doesn’t happen very often, but when a company in which you have maintained a credit card number on file goes under, you need to think about the fact that your credit card information goes with it. While there has yet to be any instance of a bankrupt company “losing” or misappropriating secure information, you still have to be concerned with how well your information is being protected. There may be no reason to be alarmed by this, but it’s always wise to be aware and take some precautionary measures to reduce your chances of fraud or identity theft.
Unfortunately, it’s not quite as easy as going to the company’s website or customer service to ask them to purge your data. They either can’t or won’t do it. Even defunct companies, especially those going through bankruptcy are required to maintain certain data for audit purposes. But, we haven’t found any law or regulation that requires a defunct company to destroy its data. In many cases, companies and their data don’t just disappear. Often times they are acquired by another company and the data, along with any privacy policies transfer over to the new company. Such is the case with Blockbuster when it went into bankruptcy and then was bought out by Dish Network. Now Dish maintains the data and is responsible for protecting it under its privacy policies.
This might give you pause, as it should, to consider all of the businesses, especially those with whom you have transacted business online, where your credit card information is stored. Blockbuster or other movie rental vendors are but one example of the type of business that stores your information. Any online merchant that you periodically order goods or services from, such as Amazon.com, stores your information as well. While there’s little likelihood of Amazon going bankrupt, there could be several online vendors you have used that store your card number. Not that you can do anything at the moment to have your information deleted from their data, you need to be aware of where your card information is stored and start tracking the vendors.
There are some additional measures you can take to help watch over your stored credit card information and minimize the chances, however slim they are, of it falling into the wrong hands:
- Consider subscribing to a credit monitoring service. It may be the best reason to do so. Certainly you can and should track your monthly billing statements, but a monitoring service can provide daily updates to your credit activity. It’s tough to stop identity theft, but the more quickly you are alerted to it, the faster you can protect yourself from further theft.
- If a company does go under, and you are concerned about your data getting into the wrong hands, as a last measure you could have the credit card company issue you a new account number. This could be a pain-in-the-neck if your credit card is used for recurring payments elsewhere, but it would give you peace-of-mind.
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