Banks that had customers’ personal information leaked in a recent hacking incident are knocking on the doors of big law firms for incident response. As hacking emerges as a risk factor for all corporations across industries, major law firms are forming hacking response teams by bringing on former high-ranking officials from the Personal Information Protection Commission (PIPC) and the Ministry of Science and ICT (MSIT) as advisers.According to the financial sector on the 20th, some of the banks and financial firms recently hit by hacking have sought consulting from hacking response units within major law firms. In addition to analyzing the causes of the hacks and advising on security system improvements, these units mainly handle responses to various legal risk issues that follow hacking incidents, including consumer compensation, criminal liability, and penalty surcharge.ATM machines of commercial banks installed across Seoul./Courtesy of News1The heads of the five major banks who appeared at the National Policy Committee’s audit of the Financial Supervisory Service the previous day were also known to have prepared in advance by refining anticipated Q&As, follow-up measures, and security enhancement plans through consulting by major law firms.Led by Shinhan Bank, KB Kookmin Bank, Hana Bank, BNK Busan Bank, Yegaram Savings Bank, and Welcome Savings Bank came under simultaneous hacking attacks between late September and early October. Not only banks but also mutual finance institutions and virtual asset service providers were affected, and the total number of personal information records leaked was around 100,000.As hacking threats targeting corporations become constant, major law firms are stacking their response teams with high-profile members. Kim & Chang has hired Choi Young-jin, former Vice Chairperson of the Personal Information Protection Commission (PIPC), Taepyungyang (Bae, Kim & Lee) has brought on Cho Kyung-sik, former Vice Minister of the Ministry of Science and ICT (MSIT), and Sejong has recruited Yoon Jong-in, former Chairperson of the Personal Information Protection Commission, as advisers and assigned them to hacking response teams. In addition, senior officials from the Korea Internet & Security Agency (KISA), the National IT Industry Promotion Agency (NIPA), and the National Intelligence Service are heading to major law firms after retirement.What they emphasize is “full lifecycle response.” Beyond responding to the hack itself, they say they provide all-around defense measures for everything corporations face after a hacking incident, including media and consumer response plans, representation in civil and criminal litigation related to the hack, and preparations for police investigations. Among these, the core is ultimately the defense against legal risk.A major law firm attorney who requested anonymity said, “Even if we bring in high-ranking officials and experts from security-related ministries to bolster expertise, the top priority for a law firm is ultimately to handle various civil and criminal procedures and craft strategies to reduce the penalty surcharge that will come down from government agencies.”Because of this, some in the financial sector criticize that while cutting information protection budgets crucial to customers, they spare no expense on incident response that eases management’s responsibility. Shinhan Bank reduced its information protection budget from 45.294 billion won last year to 40.591 billion won this year, a cut of more than 10%, and Woori Bank cut its budget from 78.659 billion won to 61.566 billion won, a reduction of more than 20%.※ This article has been translated by AI. Share your feedback here.
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