Will SK Telecom Face Consequences for Late Data Breach Report?

Seoul, July 4 (NationPress) The South Korean government announced on Friday that it will impose a fine on SK Telecom for its delayed disclosure of a data breach that impacted all 25 million users. The government has also mandated the company to waive cancellation fees for its customers, concluding a two-month investigation into one of the most serious data leaks in the nation's history.

SK Telecom reported the data breach in April, where universal subscriber identity module (USIM) data was potentially compromised during an unidentified cyberattack on its servers, as per reports from Yonhap news agency.

The government conducted a thorough inspection of all 42,605 servers operated by the company and identified 28 infected with 33 different types of malicious software, according to a press release from the Ministry of Science and ICT.

"The three primary factors that led to the malware infection were inadequate account information management, insufficient response to previous security incidents, and a lack of proper encryption for critical data," the ministry noted.

The investigation also uncovered that SK Telecom had detected malware on its servers as early as February 2022, but failed to report this to authorities as mandated by law.

In light of its reporting failure, the ministry stated it would impose a fine of less than 30 million won (approximately US$21,600) and refer the company for further inquiry regarding its alleged breach of a data preservation order.

Science Minister Yoo Sang-im remarked that this recent security incident at SK Telecom should serve as a wake-up call not just for the domestic telecommunications sector but also for the wider network infrastructure industry. "SK Telecom must address the vulnerabilities highlighted by this event and prioritize information security at the management level moving forward," he emphasized.

Yoo cautioned that future cyber threats are expected to grow more sophisticated, potentially integrating with artificial intelligence in the new AI era.

Last month, over 660,000 subscribers opted to cancel their wireless services with SK Telecom and transitioned to competitors KT Corp. and LG Uplus Corp.

SK Telecom resumed new subscriptions as of June 24, two months after the government ordered a suspension on new sign-ups. Since April, the company has been providing free USIM card replacements to all customers to mitigate risks of identity theft and financial fraud.

To avert similar occurrences in the future, the government has instructed SK Telecom to present follow-up action plans before the end of this month and will conduct inspections to review their implementation in November or December.

"Should additional measures be deemed necessary, the government will issue a correction order to the company," the ministry added.