Chipotle Under Investigation after Unauthorized Activity on Payment Processing Network
Customers should monitor their credit card statements
May 5, 2017
Chipotle may be struggling again, this time in the wake of a hacking problem.
On April 25 Chipotle revealed that it had "recently detected unauthorized activity on the network that supports payment processing for purchases made in our restaurants" and that the extent of the breach was unknown but an investigation was ongoing.
The Company further advised that customers "should closely monitor their payment card statements" for unauthorized charges and notify their issuing bank if such activity occurred.
"We anticipate notifying any affected customers as we get further clarity about the time frames and the restaurant locations that might have been affected," said chief financial officer Jack Hartung during an investor presentation.
The hacking news came just as Chipotle reported the strongest quarterly financial results from the restaurant chain since the fall of 2015, when sales started to fall from a prolonged food safety crisis. Throughout much of 2016 the company faced bad press after an E. Coli outbreak hit several states and called into question Chipotle's promise of serving fresher, healthier foods than most of their fast food rivals.
Sales after the outbreak sputtered for all of 2016, with same-restaurant sales—a key metric that excludes sales from new establishments—falling for five straight quarters.
Former Attorney General of Louisiana, Charles C. Foti, Jr., Esq., a partner at the law firm of Kahn Swick & Foti, LLC ("KSF"), has now commenced an investigation into Chipotle Mexican Grill, Inc., focusing on whether Chipotle's officers and/or directors breached their fiduciary duties to its shareholders or otherwise violated state or federal laws by not having proper security measures in place.
If you you are a long-term holder of Chipotle shares, you can find out more by emailing [email protected]