First Direct reissues cards after breach

First Direct, the UK telephone and internet bank, is reissuing credit cards to thousands of its customers after fears that they may have been affected by a major security breach at a US card-payments company in May.

In a letter to its card customers last week, the company said it was concerned that a number of its clients may have been affected by the breach at the Arizona-based company, Card Systems Solutions. The breach is believed to have put about 40 million cardholders across the globe at risk of fraud. It is thought that several other UK banks may be forced to follow First Direct's lead.

CardSystems says it identified the breach at the end of May and reported the incident to the FBI, the US security service. Most of the cards affected were those using the Mastercard system. However, a small number of American Express and Discovery cards are also thought to have been at risk.

First Direct said that only a small number of its cardholders were affected, but it wanted to ensure that these customers were fully protected.

The incident comes a few months after Citibank admitted that data relating to about 1,000 of its clients had been stolen via one of its call centres in India. HSBC, the parent company of First Direct, was also affected by a data breach affecting about 180,000 US customers in April.