A data breach that left some 40 million customer accounts vulnerable to hackers will lead to tighter security measures to protect millions of credit and debit card users, officials at the Federal Trade Commission said Thursday.

CardSystems Solutions Inc. has settled charges that the company broke the law by failing to ensure adequate safeguards for sensitive customer information. The settlement calls for better safeguards to protect consumer data.

The FTC could not seek civil penalties under the law it accused CardSystems of violating.

Atlanta-based CardSystems processed credit card and other payments for banks and merchants. Last summer, it was disclosed that tens of millions of mostly MasterCard and Visa accounts were exposed to possible fraud after a hacker broke into the company's computer system.

"CardSystems kept information it had no reason to keep and then stored it in a way that put consumers' financial information at risk," said FTC Chairman Deborah Platt Majoras.

The company stored information from the magnetic strip of credit and debit cards — account numbers, expiration dates, and security codes, the agency said. The commission also said CardSystems did not have sufficient passwords to keep a hacker from taking control of its computer network.

The assets of CardSystems have since been bought by San Francisco-based Pay By Touch. The settlement requires Pay By Touch to implement a comprehensive security program and obtain independent audits every other year for 20 years.

According to evidence gathered in a California case, the hacker was able to grab enough account information to defraud at least 264,000 customers. Visa and MasterCard maintain that there is little financial risk to vulnerable accountholders because of their "zero liability" policies that reverse all fraudulent charges.

The lawsuit sought an order requiring Visa and MasterCard to send individual warnings to thousands of consumers whose personal information was stolen in the breach. But the judge rejected the request last fall, saying there was no immediate threat of irreparable harm to consumers.