Foreign news outlets have poured out reports about Korea as an IT powerhouse for years. CNN reported last year that Korea ranked first both in Internet penetration rate (82.7%) and smart phone penetration rate (78.5%), adding that the figure astonishingly amounts to 97.7% in the age group of 18 to 24. The New York Times quotes the World Economic Forum to report that Korea is the country with the world’s fastest Internet services among 148 countries around the world.
There is no doubt that Korea is the most connected country in the world, but it is also true that it has been very vulnerable to cyber crime. The number of hacking attacks has increased 20-fold during the last five years, and Inter- net etiquette is still at a very low level.
Under the circumstances, an unprecedented leakage of personal informa- tion occurred, in which over 104 million sets of credit card information were compromised, striking a staggering blow to the security of this credit-based society, as well as the international standing of Korea as a global IT leader.
The Korean government has tried hard to prevent online personal infor- mation theft by a variety of means, including the prohibition of the use of stolen information in loan marketing and penalties on financial institutions that have leaked personal information. Nevertheless, such measures have not worked well on-site.
The number of credit cards issued in Korea exceeded 100 million a long time ago, which means every single one of the economically-active popula- tion has at least five credit cards. According to the Korea Financial Welfare Policy Institute, credit cards account for 60% of the household spending in Korea, whereas the percentage is just 15% in the United States. IT-based financial services have boosted the convenience and efficiency on the part of users and banking organizations alike. However, these entail inevitable security problems.
Most advanced economies focus more on security than on efficiency when it comes to banking systems. Awareness of the property rights and the danger of information theft is high in these countries, and anyone involved in a scandal or accident is to bear strict responsibility. However, Korea is lack- ing such awareness, and the internal control systems are not functioning very well.
As such, the recent mega-scale accident has brought about a compulsive need to recall all the security systems across the nation. In particular, the gov- ernment should strengthen personal information protection by changing the current identification system used widely in daily life, along with the revision of the Personal Information Protection Act. Likewise, financial institutions themselves will have to ensure higher security standards by setting up new internal security management and monitoring systems.
The current scandal has to be turned into an opportunity for higher security standards to be set in addition to the current convenience from which everyone benefits.