KT has accepted the fine imposed by the Personal Information Protection Commission (PIPC) and apologized to its customers. However, the company stated it will decide on potential legal action after receiving the official ruling.
On July 30, KT expressed, "We take the PIPC's decision very seriously," and added, "We sincerely apologize once again for causing significant concern and anxiety to our customers and the public due to the recent incident."
KT also mentioned, "We are overhauling our entire personal information protection system," and committed to enhancing security investments and strengthening company-wide data protection capabilities to prevent future incidents and restore customer trust.
On the same day, the PIPC imposed a fine of 53.97 billion won on KT for mishandling femtocell management, which led to a data breach and actual financial losses for customers. The investigation revealed that the personal information of 16,647 users was compromised, with 368 individuals suffering unauthorized small payment losses totaling approximately 240 million won.
Regarding the possibility of legal action, a KT official stated, "We will carefully review the details of the ruling upon receipt and will communicate our position accordingly."
In terms of accounting, KT is considering reflecting the fine as a non-operating expense. This approach is expected to have no direct impact on operating profit, but the net income for the quarter in which the expense is recorded may decrease. A KT representative noted, "We will decide which quarter to reflect the fine, either in the second or third quarter, after consulting with external auditors."
Some analysts have raised concerns that the timing of the third quarter, which coincides with increased marketing expenses due to device launches, could add pressure on performance. However, they believe that treating the fine as a non-operating expense will mitigate its impact on operating profit. Kim Hwa-jae, a team leader at Daishin Securities, stated, "Since SK Telecom also handled its fine as a non-operating expense, it is highly likely that KT will follow the same accounting treatment, which is a separate issue from third-quarter marketing costs."
Meanwhile, the PIPC confirmed that LG Uplus obstructed an investigation into a data breach incident last year by reinstalling and disposing of its server operating system. The commission has decided to refer the case for investigation on charges of obstructing official duties.
An LG Uplus representative stated, "A police investigation is already underway regarding the same matter, and we are cooperating fully with the police. We will continue to engage sincerely with the ongoing investigation."
* This article has been translated by AI.
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