South Korea's state audit agency has launched an inspection on the financial regulator for its decision giving local life insurers access to personal health records for use as credit information, financial sources said Wednesday.
According to the sources, a team of inspectors from the Board of Audit and Inspection has been at the Financial Services Commission (FSC) since Monday for a probe expected to continue up to 15 days.
The BAI sees the FSC's decision as somewhat problematic, the sources said.
Local insurers had gained access to and received permission to collect medical histories of individuals based on the conclusions by the regulator that such records can be considered as financial credit information.
"The Korea Life Insurance Association has collected even unnecessary personal medical records. Facing criticism, it has discarded some of the data," said one of the sources. "The BAI inspection is targeting the FSC's decision on the interpretation of the status of medical records."
Civic groups, including the Korea Finance Consumer Federation, had lodged a petition with the BAI, arguing that the FSC misinterpreted the concept of medical records being used as financial information.
They say that an individual's medical records are irrelevant to his or her solvency, and that health records are not financial information.
The BAI has already conducted two audits on the FSC since the beginning of the year after the regulator failed to monitor and oversee irregularities and massive data breaches at financial companies that brought on public anger and confusion. The data of more than 100 million clients were leaked from three major credit card companies earlier this year, leading to the resignations of the heads of the companies and a three-month business suspension for each company. (Yonhap)