UK Financial Conduct Authority raises concerns about data loss

August 25, 2014 |

In Customer data loss soars at financial firms Money Marketing reports on a rise in the number of customer data loss incidents in the financial sector.  While it is not surprising on one level, as the number of data breaches are on the rise worldwide it is disappointing that it should be so prevalent in the financial sector where the need for strong privacy protections should be stronger and training should be as effective as possible.

The article provides:

The number of customer data loss incidents reported to the FCA has increased significantly in the past year.

A Freedom of Information request published by the FCA shows that in 2013, the regulator was notified of 13 incidents where firms have lost customer data or had it stolen. Some 104,100 customers were affected by six of these incidents – the FCA says numbers are not known for the other seven incidents.

In 2012, the regulator was notified of just three breaches, affecting 16,591 customers. In the first quarter of 2014, it was notified of one, affecting 27,000 customers.

The incidents include stolen or lost laptops, cyber attacks on company systems, client data being sent to wrong addresses, ‘phishing’ exercises and lapses in customer identification procedures.

In 2013, there were reports of three cyber attacks, two stolen laptops and two ‘misdirections’ of data.

The incidents affecting the highest number of customers were a stolen laptop, affecting 40,059 customers, and stolen client information, affecting 48,000.

A separate FoI request published by the FCA shows there was a sharp increase in sales of self-invested personal pensions last year.

In 2012, there were 230,010 Sipp sales. In 2013, sales almost tripled to 632,831.

Sales remained high in the first quarter of 2014 at 155,736, which is the latest available figure.

In recent months the FCA has issued repeated warnings on unsuitable advice to invest in unregulated products through Sipps.

In May the Financial Ombudsman Service reported it had seen a 49 per cent increase in complaints relating to Sipps in 2013/14, from 697 to 1,039.

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