Interpark hit with record penalty for data breach

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Interpark hit with record penalty for data breach

Interpark, a leading e-commerce site in Korea, faces a 4.5 billion won ($3.9 million) fine for a data breach in May that resulted in the leak of over 20 million users’ personal information, the Korea Communications Commission said Tuesday. It is the largest penalty ever meted for a data breach in Korea.

A joint investigation by the commission and the Ministry of Science, ICT and Future Planning found that an unidentified hacker managed to obtain the personal information of over 20 million users between May 3 and May 6.

The leaked data included user IDs, encrypted passwords, names, genders, dates of birth, home and cell phone numbers and addresses.

In meting out such a hefty fine, the Korea Communications Commission explained that Interpark should have employed stronger security measures because the e-commerce operator shares certain customer information with business partners such as shipping and logistics companies. Under current laws, companies that handle personal information should be equipped with systems that allow access to a database only for a limited amount of time.

Interpark did not abide by these guidelines, according to the government, which allowed a hacker to easily break into the company’s database during a seven-day period when one employee did not turn off his computer or log off his account.

After the data breach was revealed in late July, Interpark faced severe criticism from consumer rights groups. Seoul YMCA chastised the company for succumbing to the “most elementary level of hacking.” The fact that Interpark was late in both informing the Korea Communications Commission and announcing the incident to the public fueled further outrage.

Another factor that resulted in the record penalty was a law change in 2014 that raised the maximum limit for data leak fines from a set 100 million won to 3 percent of company sales made from businesses relevant to the leaked data. “The 4.5 billion won fine on Interpark is equivalent to 1.5 percent of its sales,” a spokesman for the commission said.

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