Homeplus, one of South Korea’s largest grocery chains, will have to explain during a parliamentary inspection what seems like an intentional leakage of its customers’ private information to third parties.

Its alleged wrongdoings come at a time when public criticism is growing against the country’s weak security protection systems, following a series of information theft, leaks and monitoring.

Homeplus executives, including chief executive Do Sung-hwan, as well as its multinational owner U.K.-based Tesco, face a tough grilling by lawmakers of the National Assembly’s trade, industry and energy committee this week.

To make matters worse, the retailer has earned a low grade in terms of value sharing with its suppliers.

They will need to answer publicly why the company allowed the leak of consumers’ data, and why it has been reluctant to improve its business relations with partners. It will be hard for Homeplus to talk its way out of this, as Koreans are not expected to treat this issue lightly.

Lawmakers of the main opposition New Politics Alliance for Democracy found that Homeplus had sold private data of over 5 million customers who signed up for free giveaway events on Homeplus’ grocery store and corporate websites to third parties.

The NPAD said the discount chain earned more than 10 billion won ($9 million) by attracting consumers to participate in its events to win pricey gifts such as BMW and Mercedes-Benz luxury cars between October 2010 and July 2014.

Lawmakers are not ruling out the possibility of Homeplus making more money out of this malpractice as several news reports say that the company may have sold more than 9 million customers’ personal information.

It allegedly duped them to skip reading through a long list of conditions and fill out their private information online, which was then sent to some 50 companies, mostly in the financial sector, including Shinhan Life Insurance, LINA Korea, KB Kookmin Bank, Samsung Card and SK Telecom.

An NPAD lawmaker said Homeplus used gifts as bait to acquire consumers’ information and sold them with high margins.

The companies, which used the information to market their products to those customers, will not be able to avoid public backlash either.

“Homeplus, which illegally sold its online customers’ information, is an unethical company,” said an NPAD lawmaker, adding that it has urged the prosecution to expand its probe into the grocery chain.

The NPAD said the company had clearly violated a law on information protection, noting that other discount stores such as E-Mart and Lotte Mart and online portals such as Naver and Daum did not have the same conditions as Homeplus that allowed them to send information to third parties for marketing purposes.

Facing a heavily saturated market with limited resources to expand, Homeplus may have opted to use short-sighted business tactics to make a quick profit. But critics say it has dealt a severe blow to its image, and in the end, the company will have to pay the price for hurting the market.

By Park Hyong-ki (hkp@heraldcorp.com)