Lee Chan-jin, head of the Financial Supervisory Service, said on the 16th, "We must take the recent cyber intrusions in the financial sector as a painful opportunity for self-reflection," and "I ask that top management personally attend to protecting financial consumers' information from a long-term perspective."
On this day at the Credit Finance Association in Jung District, Seoul, Lee held a meeting with 14 chief executive officers (CEOs) of credit card companies and installment finance companies, which are specialized credit finance companies, and made these remarks. Lee said, "We need to look back on whether we have focused only on short-term performance through cost reduction while neglecting long-term investment in information security," and pointed out, "In the case of the card industry, because it handles information on the entire population, there is a need for deep vigilance about information protection."
Earlier, Lotte Card suffered a hacking attack on the 14th of last month, causing an incident in which internal files were leaked. The total amount leaked was 1.7 gigabytes (GB), and it was reported to be information related to payments. Lotte Card disclosed the incident only on the 31st of last month, 17 days after it occurred.
Lee said, "I ask that you strictly adhere to your information protection obligations by fundamentally re-examining your cyber security infrastructure yourselves with the principle that not even a single incident will be tolerated," and "Please make every effort to establish and implement security measures required by relevant laws and regulations, including the Credit Information Act."
Lee also asked for improved consumer access to information. Lee said, "In recent emergency situations such as hacking incidents, there have been many complaints that card suspensions and reissuances are difficult due to difficulties with phone connections and complicated procedures," and added, "So that consumers can exercise their right to defend themselves in a timely manner, please radically improve consumer access channels by overhauling apps and websites and expanding integrated call center operations at night and on weekends."
Lee also said, "Please strengthen financial support for the marginalized," and, "For small claims against long-term borrowers in arrears, refrain from extending the statute of limitations, and consider consumer-friendly practices such as invigorating the use of card points by older adults." Lee added, "We ask that you pay more active attention to supporting the recovery of borrowers in arrears, such as in-house debt adjustments under the Personal Debtor Protection Act and expanding Sunshine Loans for workers, as well as supplying funds to vulnerable groups."
Regarding soundness management, Lee said, "Through the responsibility structure map scheduled to take effect next year, please take special care to ensure that the function of preventing financial accidents operates properly," and, "In light of the recent rise in arrears rates, we ask that you also make every effort to manage the soundness of specialized credit finance companies."
At the meeting, an opinion was raised that, as profitability has declined due to intensifying competition in the payments market and an economic slowdown, policy and institutional support from financial authorities is needed to define the business scope of specialized credit finance companies.