- Story by: Joy Dunbar
- Magazine: FinancialAdviser
- Published Thursday , May 01, 2008 http://ftadviser.com/FinancialAdviser/Regulators/News/article/20080501/b97dafa2-12d0-11dd-a42f-0015171400aa/Firms-should-tighten-data-protection-measures–FSA.jsp
Data security is an issue for everyone who holds sensitive customer data, according to the FSA’s financial crime sector leader.
The warning follows a number of high profile security breaches including HSBC’s loss of 370,000 customer details and Nationwide being fined almost £1m after a laptop was stolen from an employee’s home in 2006. Philip Robinson, director of the FSA’s financial crime and intelligence division, said: “If firms are collecting data it needs to be kept safe. For small firms we are issuing a factsheet and the main issues for them is physical security. We found that some people left security data in their cars or at their homes.
“We found that firms have been burgled and that computers containing customer details have been stolen. Customer data is a valuable commodity as there is a mature market for the sale and purchase of customer data. IFAs have a lot of customer data about people’s family, medical history and financial history. Data stolen from a small firm might be used to get access to someone insurance products in another firm – that is the crucial issue.”
Mr Robinson spoke at the FSA’s annual conference on financial crime last week and also discussed anti-money laundering, anti-terrorist financing and new approaches to fighting fraud.
He added there is a need for strategic gathering together for the work on fraud, which is estimated to cost the country more than £14bn a year.
He said: “The City of London police will have 200 new police officers that will only deal with fraud and will work closely with the Serious Fraud Office. Things are being brought together to make them more effective. We are going to visit about 200 small firms in the next 18 months and examine their anti-crime procedures, 200 should give us enough to do an assessment in managing various risks. If it shows that firms are universally bad we will have to do something about it. The work that we are doing on mortgage fraud with the police is having an impact on mortgage advisers. The FSA has been taking action against advisers who have been making fraudulent applications.”
Fay Goddard, deputy director general of the Association of IFAs, said: “If you take a typical IFA, they have no need to send out client details. The nature of the business means that that information generally is likely to be more secure. A lot of the details are on back-office sites, unless they were using a wrap platform and then we would expect the IFA to check out the security, the personal details are not in a public facing internet service.”