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Top regulator vows to punish card firms for info leakage

Top regulator vows to punish card firms for info leakage

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Published : 2014-01-10 20:15
Updated : 2014-01-10 20:15

Financial Supervisory Service Gov. (Choi Soo-hyun)
Some of the country’s major credit card firms are likely to face tough disciplinary measures, including a business suspension, following a massive breach of credit card user data.

The chief financial regulator raised the possibility while ordering a full-fledged investigation into three local credit card issuers linked to the case.

“(For credit card firms,) leaking of customers’ information is something that should never happen as the foundation of financial service is trust,” Financial Supervisory Service Gov. Choi Soo-hyun said Thursday.

Choi also indicated that the FSS would conduct on-the-spot inspections on the implicated credit card firms starting from Monday to indentify security loopholes.

His comment came amid an ongoing probe into the country’s largest-ever data breach scandal. Prosecutors announced earlier this week that they indicted an employee of the Korea Credit Bureau, a local credit rating firm, on charges of leaking information of more than 100 million credit card customers and their transaction data.

The 39-year-old suspect surnamed Park is believed to have leaked the massive amounts of sensitive data from KB Kookmin Card, Lotte Card and NH Nonghyup Card and sold them to brokers. The three firms all use the same credit card fraud detection system developed by the KCB.

The system, known as FDS, is used to analyze customers’ credit card usages and automatically stops card payments if an unusual pattern of transaction detected. Most credit card companies here have been using various types of the FDS to prevent and detect card fraud.

The financial regulatory agency will also consider imposing strong disciplinary measures on officials from the credit card firms responsible for protecting customers’ information for the case, an official from the FSS said.

“This is unprecedented case. We’ll take stern disciplinary action,” he added.

Meanwhile, KB Kookmin Card reportedly lost data of 53 million customers while Lotte Card and NH Nonghyup Card lost 26 million and 25 million customers’ data, respectively, in the case, according to the Changwon District Prosecutor’s Office. The prosecution said it would continue to investigate the three companies as well as other credit card firms over possible additional data leaks.

By Oh Kyu-wook (596story@heraldcorp.com)

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