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Lotte Homeshopping fined W200m for selling customer data
By Sohn Ji-youngPublished : Aug. 12, 2016 - 14:46
Korea Communications Commission, the state telecom and media regulator, on Thursday handed Lotte Homeshopping a fine of 200 million won ($182,000) for mishandling customers’ personal data.
Lotte Homeshopping is a television shopping channel under South Korean retail giant Lotte Group, which is currently under heavy investigation on charges of embezzlement and bribery.
Woori Homeshopping Co., the operator of the Lotte-based TV channel, was found to have sold the personal data of some 29,000 customers to third parties without due consent, the KCC said in a statement.
The company received a 180 million won fine for such actions, and an additional 20 million won for inadequate user data protection such as failing to encrypt user data and not deleting user data when an account expires.
According to the KCC, Lotte Homeshopping sold the personal data of more than 324 million customers -- under the “third-party marketing” clause in its customer terms and agreement, which some users did not agree to -- to local insurance companies from July 2007 to March 2014.
The media regulator said that the TV shopping operator reaped some 3.74 billion won in gains from February 2009 to September 2015 from such customer data sales, though there may be more unconfirmed gains.
The current law prohibits companies from transferring customer data to third parties without due consent. Violators face up to five years in prison or up to 50 million won in fines. The KCC plans to hand over the Lotte case to the prosecution for further investigation.
The recent event has further raised public concern over the safety of personal data in Korea, where many local customers say that they are not thoroughly notified of the ways in which their data might be transferred and sold for a profit.
On the same day, the KCC fined a number of other companies such as Woowa Brothers, the operator of mobile food delivery app Baedal Minjok, CJ CGV, Hyundai Homeshopping and CJ Homeshopping for mismanaging user data.
By Sohn Ji-young (jys@heraldcorp.com)
Lotte Homeshopping is a television shopping channel under South Korean retail giant Lotte Group, which is currently under heavy investigation on charges of embezzlement and bribery.
Woori Homeshopping Co., the operator of the Lotte-based TV channel, was found to have sold the personal data of some 29,000 customers to third parties without due consent, the KCC said in a statement.
The company received a 180 million won fine for such actions, and an additional 20 million won for inadequate user data protection such as failing to encrypt user data and not deleting user data when an account expires.
According to the KCC, Lotte Homeshopping sold the personal data of more than 324 million customers -- under the “third-party marketing” clause in its customer terms and agreement, which some users did not agree to -- to local insurance companies from July 2007 to March 2014.
The media regulator said that the TV shopping operator reaped some 3.74 billion won in gains from February 2009 to September 2015 from such customer data sales, though there may be more unconfirmed gains.
The current law prohibits companies from transferring customer data to third parties without due consent. Violators face up to five years in prison or up to 50 million won in fines. The KCC plans to hand over the Lotte case to the prosecution for further investigation.
The recent event has further raised public concern over the safety of personal data in Korea, where many local customers say that they are not thoroughly notified of the ways in which their data might be transferred and sold for a profit.
On the same day, the KCC fined a number of other companies such as Woowa Brothers, the operator of mobile food delivery app Baedal Minjok, CJ CGV, Hyundai Homeshopping and CJ Homeshopping for mismanaging user data.
By Sohn Ji-young (jys@heraldcorp.com)
