Learn what the Target data breach teaches about vendor risk and credential security.
• Attackers entered Target’s network through credentials stolen from an HVAC vendor. Vet and limit every third-party connection
• Security tools flagged the malware but nobody investigated the alerts. Detection without response is useless
• The CEO and CIO both resigned after the breach. Security failures carry personal consequences for leadership, not just the company
• Network segmentation would have kept attackers away from POS systems. Isolate vendor access from critical systems
In late 2013, attackers stole payment card data from 40 million Target customers. Personal information from 70 million more was exposed too.
The total cost exceeded $200 million. But the breach didn’t start with some zero-day exploit. It started with stolen credentials from an HVAC vendor.
That attack pattern, a compromised vendor login used to reach a corporate network, still drives breaches today.
This case study breaks down how the Target data breach happened, what it cost, and what your security team can learn from it.
The Target data breach of 2013 remains one of the most studied cyberattacks in retail history. The scale and simplicity of the attack made it a turning point for how companies think about security.
A data breach occurs when unauthorized individuals access sensitive information they shouldn’t have. Breaches range from stolen payment cards to exposed employee credentials. The damage depends on what was taken and how fast you were able to respond.
Attackers gained access to Target’s network in mid-November 2013. They used stolen credentials from Fazio Mechanical, a third-party HVAC vendor. Once inside, they moved laterally until they reached point-of-sale systems across 1,797 stores.
Over three weeks, malware on those POS systems captured payment card data from every in-store transaction. About 40 million cards were compromised. Attackers also stole personal information from 70 million additional customers.
The breach wasn’t discovered by Target’s own team. Their FireEye deployment generated alerts about the malware. Nobody investigated them. An external payment processor identified suspicious transactions and contacted Target in mid-December. By that point, attackers had been siphoning card data for nearly three weeks.
The entry point wasn’t a zero-day exploit or some rare vulnerability. It was a compromised vendor login.
A third-party data breach happens when attackers compromise a vendor or partner to reach their real target. Your security depends on your vendors’ security. If a contractor with network access gets phished, attackers can use those credentials to pivot into your systems.
Fazio Mechanical, a Pennsylvania-based HVAC company, had remote access to Target’s network for electronic billing and contract submissions. Attackers phished Fazio employees and stole their login credentials.
With those credentials, attackers entered Target’s network. The critical failure was that Fazio’s access wasn’t isolated from sensitive systems. Attackers moved from the vendor portal to Target’s internal network and eventually reached the POS environment.
They installed RAM-scraping malware called BlackPOS on checkout terminals. This malware captured card data at the moment of the swipe, before encryption could protect it. The stolen data was staged on internal servers, then sent to external systems the attackers controlled.
The third-party attack vector used against Target is still one of the most common paths into corporate networks. The Verizon Data Breach Investigations Report consistently names stolen credentials as the top initial access method.
Vendor-related breaches have only become more common since Target. Attackers prefer targeting smaller companies with weaker security to reach larger companies through shared network connections.
The financial damage extended years beyond the initial incident. Target spent over $200 million in total when you add up every line item.
Settlement costs:
Direct expenses:
Business impact:
The average data breach costs $4.88 million according to IBM’s Cost of a Data Breach Report. Target’s breach cost roughly 40 times that.
The brand damage was harder to quantify. Consumer surveys after the breach showed drops in shopping intent at Target stores. The company spent years rebuilding customer confidence through visible security investments and public transparency.
Target’s initial response was slow, but the long-term security changes were real.
Immediate actions:
Long-term changes:
Target’s breach response became a widely studied example of what to improve. The biggest lesson from the response: having security tools deployed isn’t enough. You need people and processes ready to act when alerts fire. Many companies increased their security investments after watching what happened to Target.
The Target breach happened in 2013, but the attack pattern hasn’t changed. Here’s what still applies to your team today.
Fazio Mechanical had broader access than they needed. Your vendors should only reach the specific systems required for their work. Every vendor with network access is a potential entry point. Treat vendor credentials with the same scrutiny you apply to employee accounts.
Review vendor permissions regularly and use third-party risk management practices to reduce your exposure.
If Target had isolated their POS environment from the general network, attackers couldn’t have pivoted from vendor access to payment systems. Network segmentation contains breaches. Even when attackers get in, segmentation limits what they can reach.
Target’s FireEye deployment detected the breach. The team didn’t respond. Build response playbooks for every alert type. Run tabletop exercises so your team knows exactly what to do when tools flag suspicious activity.
The breach started with a compromised vendor account. Credential monitoring catches exposed passwords before attackers use them. If Target had detected Fazio’s compromised credentials on the dark web, they could have revoked access before the attack began.
Target’s delayed response made everything worse. A tested incident response plan ensures your team acts fast when it counts. The NIST Cybersecurity Framework provides a solid starting point for building one.
The Target data breach started with one vendor’s stolen credentials. Attackers used that access to compromise tens of millions of payment cards and customer records.
The key takeaways for your team:
Stolen credentials are still the most common way attackers get in. Find exposed credentials fast and reset them faster.
The breach was active from November 27 to December 15, 2013. Attackers had access for about three weeks before Target removed the malware. An external payment processor spotted the suspicious activity first.
About 40 million payment card records were stolen. An additional 70 million customers had personal information like names and addresses exposed.
Attackers stole credentials from Fazio Mechanical, an HVAC vendor with network access. They used those credentials to enter Target’s network and move laterally to the point-of-sale systems.
The total cost exceeded $200 million. That includes an $18.5 million multi-state settlement and $61 million in direct expenses. Sales dropped in Q4 2013 and the reputational damage lasted years.
Evidence pointed to attackers in Eastern Europe. Two individuals were arrested. A Latvian programmer received a 14-year sentence for improving the POS malware used in the attack.
Third-party vendor access is the biggest takeaway. The breach also proved that network segmentation and credential monitoring aren’t optional for large organizations.
Authentication Dark Web Monitoring Credential Monitoring Security Tools
Top 10 Account Takeover Solutions at a Glance Platform Category Best For Breachsense Credential Intelligence Dark web …
Dark Web Monitoring Compromised Credentials DarkOwl Threat Intelligence Credential Monitoring
What Does DarkOwl Do? DarkOwl is a darknet data platform. They collect content from across the dark web and make it …