UK regulator imposes $5.2 mn fine on HSBC for data loss
Press Trust of India / London Jul 22, 2009, 18:56 IST
UK financial regulator Financial Services Authority (FSA) has fined three group companies of banking major HSBC to the tune of 3.2 million pounds (about $5.2 million) for the loss of confidential data.
The FSA has imposed penalties on HSBC Life UK (HSBC Life), HSBC Actuaries and Consultants (HSBC Actuaries) and HSBC Insurance Brokers (HSBC Insurance Brokers).
In a statement today, the regulator said it has fined three HSBC firms 3.2 million pounds for not having adequate systems and controls in place to protect their customers' confidential details from being lost or stolen.
"These failings contributed to customer data being lost in past two occasions," it added.
HSBC Life has to shell out 1.6 million pounds while HSBC Actuaries and HSBC Insurance Brokers have to pay 875,000 pounds and 700,000 pounds, respectively.
During the investigation, the FSA found that large amounts of unencrypted customer details had been sent via post or courier to third parties.
"Confidential information about customers was also left on open shelves or in unlocked cabinets and could have been lost or stolen. In addition, staff were not given sufficient training on how to identify and manage risks like identity theft," the statement noted.
As unfortunate as this situation might seem to HSBC, it will be viewed as a win by UK citizens. I have discussed or read about too many situations where personally identifiable information is mishandled with no consequence except to the individual.
More importantly, there are technology solutions (such as Egress Switch) that can control access or lockdown data files on CDs and other media that will solve this problem more efficiently than suffering the data breach and paying the fines.
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