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The South Korean operator claims the record-breaking fine is excessive and does not consider the company’s proactive response
Last year, SK Telecom (SKT) revealed it had suffered an enormous data breach in 2022, affecting 26.9 million customers. The Personal Information Protection Commission (PIPC) subsequently fined the company 134.8 billion won (around $91 million) for failing to protect customer data.
Now, SKT has said it will appeal the fine, with reports suggesting that the operator deems the fine to be unjustified and disproportionate.
The fine is the largest ever delivered by the PIPC, far exceeding the previous record: a 100 billion won ($68 million) fine imposed jointly on Google and Meta in 2022 for collecting user data for personalised ads without clear consent.
“We are seeking a detailed judicial review of whether the PIPC’s penalty is appropriate,” said SKT in a statement.
The penalty from the PIPC was calculated based on SKT’s mobile revenue, a fact which SKT says differs from previous PIPC rulings. In a 2023 case against SKT’s rival LG Uplus, for example, the resulting fine based on purely on the revenue generated from the specific system that was hacked, resulting in a much smaller penalty (6.8 billion won, or $4.6 million).
The operator also notes that there has been no reported direct or indirect damage to customers as a result of the breach.
This claim, however, has been challenged by the Korea Consumer Agency (KCA), which was approached by 58 of the affected customers seeking dispute mediation last year.
“Considering the joint investigation conducted by the government and the private sector in July and the ruling by the PIPC, it was recognized that the hacking incident caused damage to consumers,” the agency said.
“SK Telecom holds responsibility for compensating individual consumers for the damage,” it added.
In December, the KCA ordered SKT to offer affected customers 100,000 won ($67) in compensation in the form of 50,000 won ($33.5) reduction in monthly subscription fees and 50,000 won in credits usable as cash equivalents.
If the ruling stands and every customer makes use of the offer, SKT’s total estimated payout would be around 2.3 trillion won ($1.5 billion) – greater than the company’s 1.43 trillion won ($970 million) net profit in 2024.
The operator is reviewing the ruling and may yet contest it.
SKT has so far pledged to invest 1.2 trillion won ($783 million) in improving its cybersecurity measures and compensating customers affected by the breach.
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