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This file photo taken Oct. 6, 2020, shows Naver Corp.'s headquarters in Seongnam, south of Seoul. (Yonhap) |
South Korea’s financial watchdog imposed a fine of 23.6 million won ($20,000) on Naver Financial and issued sanctions on its executives, citing the lack of security of its e-payment system and other violations tied to management, reports said Monday.
According to local reports, the Financial Supervisory Service earlier this month slapped a fine on Korean portal giant Naver’s wholly owned financial technology unit and issued “warnings,” the lowest level of its five-tier sanctions system, to three of its executives. The executives were not named.
Regarding security matters, the FSS took issues with Naver Financial’s failure to separate internal and external networks, the reports said. The firm allowed a part of its office work program connected to its intranet to be accessed by its regular internet, exposing its intranet to external risks, the FSS reportedly revealed.
Under the Electronic Financial Transaction Act, e-payment operators are obligated to separate the two networks and block any access from the outside.
Additionally, Naver Financial did not shut down internet access when operating its data processing system for databases, which is usually handled offline to reduce security breach risks. It also failed to inform its e-payment users “properly” in changing the database of the users, such as their account numbers and cash balance. It is mandatory for e-payment operators, under the current law, to inform and receive permission from its users and changing the database of their customers’ financial information and history, when fixing an error.
Naver Financial was launched in November 2019. Parent firm Naver Corp. said last month that its fintech revenues jumped 38.9 percent on-year to 241.7 billion won in the July-September period. The transaction amount of Naver Pay also jumped 38 percent on-year to 9.8 trillion won in the cited period.
By Jung Min-kyung (
mkjung@heraldcorp.com)
