Feb 03, 2014

    S. Korea to suspend firms hit by data theft


    SOUTH Korean regulators will order three consumer finance companies to suspend operations for three months as early as Feb 14, following the nation's biggest theft of data to hit credit-card holders, an official said.

    The Financial Services Commission (FSC) plans to notify the card units of KB Financial Group, NH Financial Group and the Lotte Group of its decision today, Mr Rhee Yun Su, a commission official, said by phone yesterday.

    The companies will have 10 days to appeal following notification, Mr Rhee said. "Unless there's some change, the suspensions will take effect on Feb 14."

    The theft has riled the public and politicians in a country where consumers use plastic for more than half of their spending.

    President Park Geun Hye on Jan 27 demanded a thorough investigation, and FSC chairman Shin Je Yoon apologised for the breaches, which prompted clients to cancel cards and top executives at the firms to offer to quit.

    KB Financial yesterday accepted Kookmin Card chief Shim Jae Oh's resignation.

    In a nation of more than 50 million people, about 2.28 million card holders at the three companies have requested cancellation of their cards, while 3.84 million customers had demanded that cards be re-issued as of Saturday, according to an FSC tally.

    About 20 million card holders at Lotte Card and Nonghyup Bank, and 40 million at KB Kookmin Card, were affected, the Financial Supervisory Service said on Jan 19.

    The estimate may include overlaps for multiple card holders or former customers.