By Na Jeong-ju
Korean financial firms need to strengthen the ethical standards of their workers who handle consumer data because leaks could lead to serious crimes, analysts said Thursday.
The recent data leaks from three credit card firms and two banks have cast doubt on consumer protection policies at local financial firms.
“Such a disaster could happen again at any time because firms only focus on collecting more consumer data. They are indifferent to protecting this information,” said Lee Yoon-seok, an analyst from the Korea Institute of Finance said. “That’s partly because regulators have failed to sternly handle data leak cases in the past. Financial firms also have paid little attention to the workers handling consumer data.”
Lee stressed that what matters is not technology, but their ethics.
“Korean firms have adopted advanced data protection systems, but are negligent in educating staff operating them,” he said. “In most firms, even junior staff can access consumer data, but they are given few opportunities to learn about ethics. They should know stealing data is a serious crime.”
According to the prosecution, an official of the Korea Credit Bureau (KCB), a credit information service provider, copied the personal information of millions of customers while working with the financial firms from 2012 to 2013, and sold the data to an advertiser. The data include names, addresses, phone numbers and bank account numbers.
“Systems don’t matter if employees who operate the systems are not trained well,” said an official from the Korean Federation of Banks (KFB), asking not to be named. “The data theft case shows financial employees with poor ethics can cause havoc on society. Firms should pay more attention to improving ethical standards for employees.”
Equally important is to strengthen the monitoring of staff dealing with consumer information, he said.
“The KCB and the victimized financial firms couldn’t detect the theft case for a long time until the prosecution launched a probe. This is more serious than the crime itself because the stolen data could have been used for financial scams,” he said.
Analysts also called for stronger punishment for those involved in information leaks as well as firms with poor monitoring systems.
“The government needs to raise awareness of the importance of consumer data protection first. In this sense, strengthening punishment for firms and executives responsible for data leaks is a step in the right direction,” the KFB official said.
On Thursday, the Financial Services Commission said it also plans to strengthen punishment for those involved in future consumer data leaks by raising fines and the maximum period of business suspension for firms to six months from the current three.
The regulator also indicated that there will be stern punishment, too, for executives. The CEOs and executives of the firms responsible for data leaks will face losing their jobs, the regulator said.