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Fraud Suspect Not Linked to Target Breach, Police Say

A man accused of fraudulent use of credit cards at a Target Corp. (TGT) store in Texas isn’t believed to be responsible for initiating a breach at the retail chain in December involving the theft of card data from 40 million customers, according to police in Georgetown, Texas.

While Guo Xing Chen, 40, was initially suspected of being connected to the holiday season data breach, “at this time there is no indication where he obtained the fraudulent card information,” Police Captain Roland Waits said today in an e-mailed statement.

The company said the December breach may have compromised 70 million addresses, phone numbers and other pieces of information in addition to the data on the 40 million cards. This week, Target’s board of directors ousted Chief Executive Officer Gregg Steinhafel, saying the time is right for new leadership.

Molly Snyder, a spokeswoman for Target, didn’t immediately respond to a call and an e-mail after regular business hours seeking comment on Chen’s arrest.

Steinhafel, a 35-year Target employee, was already under scrutiny for lagging rivals in e-commerce and overseeing a Canadian expansion that lost almost $1 billion last year. The pressure mounted over the holiday season, when hackers overcame Target’s defenses and stole shoppers’ personal information.

With more than 1,900 stores in North America, Minneapolis-based Target ranks as the second-largest U.S. discount retailer, behind Wal-Mart Stores Inc.

To contact the reporter on this story: Joel Rosenblatt in San Francisco at jrosenblatt@bloomberg.net

To contact the editors responsible for this story: Michael Hytha at mhytha@bloomberg.net Peter Blumberg

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