The financial authorities are conducting on-site inspections to ascertain the causes of the SGI Seoul Guarantee 'system paralysis' incident. Based on the results of this on-site inspection, the financial authorities are expected to determine the level of discipline against SGI Seoul Guarantee. SGI Seoul Guarantee is closely monitoring the situation as the financial authorities' sanctions could disrupt its operations.
According to the financial industry on the 21st, a financial authorities official is specifically identifying the cause of the system paralysis at SGI Seoul Guarantee's headquarters. The official noted, 'Currently, we are primarily focusing on identifying the cause of SGI Seoul Guarantee's system incident and fully restoring the internal system. However, if significant negligence is revealed through this inspection, disciplinary procedures will be initiated based on current law.'
The financial authorities can impose sanctions on institutions and internal employees that have caused property losses to financial transaction participants, among others, according to current regulations. Sanctions can range from the mildest level of institution warning to institutional warnings and temporary business suspensions at some branches or headquarters. Institution warnings are classified as serious sanctions, and there will be a prohibition on pursuing new business ventures for a certain period. If an institution receives three institution warnings, it will then be subject to an institution warning.
The financial authorities can take actions such as recommending dismissal, suspending execution of duties, issuing reprimands, issuing cautionary warnings, and other measures against executives of financial companies. Individual employees may face sanctions such as dismissal, suspension, salary reduction, or reprimand. If executives or employees are unable to work for a certain period due to the financial authorities' actions, operational disruptions become inevitable.
SGI Seoul Guarantee is reportedly considering ways to reinforce its workforce through local branches if some employees become unable to work due to sanctions. However, SGI Seoul Guarantee maintains that, even if it receives a high level of punishment, it can prevent operational disruptions, as it has a higher proportion of information technology (IT) personnel at 7% (approximately 105 people) compared to other companies.
Industry experts believe the likelihood of severe sanctions such as business suspension is low. In 2013, sanctions were imposed on NongHyup Bank, NongHyup Life Insurance, NongHyup Property Insurance, Shinhan Bank, and Jeju Bank, which experienced network disruptions due to cyber attacks. The Financial Supervisory Service held the five investigated corporations responsible for IT outsourcing supervision and imposed institution warnings along with sanctions on 23 employees. However, only low-level measures such as reprimands and warnings were taken.
A financial industry official said, 'The level of discipline will depend on whether this incident was caused by an external intrusion, internal mistakes, and how much effort employees put into ensuring system security.'