Processing System Intrusion

9 Months Ended

Feb. 28, 2014

Extraordinary and Unusual Items [Abstract]

Processing System Intrusion

PROCESSING SYSTEM INTRUSION

In early March of 2012, we identified and self-reported unauthorized access into a limited portion of our North America card processing system. Our investigation also revealed potential unauthorized access to servers containing personal information collected from merchants who applied for processing services. As a result of this incident, certain card networks removed us from their list of Payment Card Industry Data Security Standards ("PCI DSS") compliant service providers. We have since received reports on compliance covering our systems that process, store, transmit or otherwise utilize card data and we have been returned to the network list of PCI DSS compliant service providers. During the nine months ended February 28, 2014, we recorded a credit of $7.0 million associated with this incident related to insurance recoveries. This brings total insurance recoveries recognized to date to $27.0 million, and we do not expect any additional recoveries. During the three months ended February 28, 2013, we recorded a net credit of $1.2 million associated with this incident. This net credit reflects $18.0 million of insurance recoveries that we recorded during the three months ended February 28, 2013. During the nine months ended February 28, 2013, we recorded $8.3 million of expense, net of insurance recoveries, associated with this incident. To date, we have not experienced a material loss of revenue that we can confirm has been related to this incident. However, this incident and our related remediation efforts could potentially have a negative impact on future revenues.