Shinhan Card users fall victim to identity theft

The headquarters of Shinhan Card located in central Seoul / Yonhap

By Anna J. Park

About 20 Shinhan Card customers are confirmed to have incurred 30 million won ($24,400) in combined losses from recent card fraud incidents resulting from identity theft.

According to Shinhan Card, Friday, dozens of cardholders became aware of fraudulent transactions of millions of won made with their cards upon receiving payment notification messages on their smartphones.

Although the company has said that there are about 20 confirmed cases at this stage, there could be several more.

“The company is currently investigating the recent fraud cases. Upon completion of the investigation, the victims will be compensated,” an official from Shinhan Card told The Korea Times.

Identity theft has been a particularly common problem for Shinhan Card holders during the past decade. From 2010 to 2014, similar card fraud incidents led to the theft of a total of 104 million won from the company's customers, leading market watchers to cast doubts on the company's internal systems to protect its customers.

The Financial Supervisory Service (FSS) announced Friday afternoon that it will launch an investigation into the incidents.

“Once the inspection is complete, the FSS will conduct inspections of every credit card company, if necessary, aiming to overhaul the card industry's fraud prevention systems,” the FSS press release stated.

In particular, the FSS pointed out that the company's card issuance numbering system makes card holders vulnerable to criminal acts. Thus, the financial authority urged Shinhan Card and other card companies to enhance their card issuance systems.