Shopacheck fined £150,000 for losing customer data

| July 5, 2012
Shopacheck fined £150,000 for losing customer data

Welcome Financial Services has been fined £150,000 for losing tapes containing details of loans made to 510,000 customers of its Shopacheck service.

Shopacheck offers loans to people with a low credit rating, often at an APR as high as 399.7 per cent.

The lost tapes also held bank account details and CV information for 20,000 of the company’s employees.

The back-up tapes have never been recovered and Cattle Group, Welcome Financial Services’ parent company, has introduced new procedures since the loss occurred in November last year.

The lost tapes were not encrypted, although special equipment was needed to access the data.

Welcome Financial Service was fined by the Information Commissioner’s Office (ICO) for the data loss.

In a statement, Welcome Financial Services (WFS) said it “has been working closely with the relevant authorities since voluntarily reporting the matter to the ICO.

“WFS also employed a specialist data security firm, with extensive experience in financial services, to review data security across the group and advise on any necessary improvements.

“While there is still no evidence that the information has fallen into the wrong hands or been used maliciously, WFS takes its obligations to protect personal data of its customers and staff extremely seriously and is implementing all of the changes to its data protection processes recommended by both the ICO and its own independent review.”

The fine, which is classed as a civil monetary penalty (CMP), will be reduced to £120,000 if the firm pays promptly.

The ICO starting issuing CMPs in April 2010 and has issued 21 notices so far with a total value of over £2m.

With household incomes under pressure as a result of the economic downturn, more people are turning to loan companies such as Shopacheck.

A recent survey by the Unite union found that 82 per cent of its members are unable to make their monthly salary last until the next pay day.

Out of this 82 per cent, 12 per cent had resorted to payday loans to help them make ends meet.

Unite’s members reported having to borrow money to pay for essentials such as rent or mortgage payments, food, utility bills and petrol.

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