By Kang Seung-woo
Hyundai Capital and its chief executive Chung Tae-young are likely to face disciplinary action from the Financial Supervisory Service (FSS) for the firm’s ineptitude in protecting its data from hackers.
With the capital firm likely to receive an institutional disciplinary warning for exposing the personal information of some 1.75 million people, the FSS is deciding on punitive measures against Chung which could range from a disciplinary warning to suspension from duty.
The nation’s financial watchdog, which recently wrapped up its special inspection of Hyundai Capital, is expected to hold a disciplinary committee meeting in July and finalize the penalties by August.
Speculation on the punishment came after the company’s website was attacked between March 6 and April 7 and the personal information of around 1.75 million customers was breached by hackers who planted a malicious program there.
Hyundai Capital, an affiliate of automotive giant Hyundai Motor and the largest lender in the country’s secondary financial sector, specializes in personal loans, home mortgages, and auto financing.
The FSS is reported to have found no evidence that Chung is linked to the cyber criminals. But holding him responsible for the incident as the company CEO, he is expected to face a penalty.
The regulator’s punitive actions include dismissal, suspension from duty or a disciplinary warning. A person who is suspended from duty is banned from holding an executive post at a financial company for four years. Chung’s tenure is scheduled to expire in March next year.
If the FSS gives Chung a penalty equivalent to a disciplinary warning, the punishment would bar the CEO, who has headed the company since October 2003, from taking up a post at another local financial company for the next three years.
The financial industry believes that there is only a remote chance for him to be handed a suspension and instead, his penalty is likely to be a disciplinary or cautionary warning.
The FSS said that it has yet to reach any decision on the case.
“Internal reviews have not been completed yet, so there is nothing decided on the level of punishment,” said an official of the FSS.
Along with its CEO, the financial firm’s executives and employees in charge of information technology (IT) and security are also likely to be disciplined.
Meanwhile, the FSS last month announced its interim results from its half-month inspection that found Hyundai Capital failed to put in place sufficient preventive measures required under electronic trading regulations.