Seoul: KT Corp. announced Tuesday it will waive contract cancellation penalties for customers wishing to terminate their contracts due to a significant data breach reported in September, which led to unauthorized micropayments.
According to Yonhap News Agency, the government's investigation into the security breach at KT concluded that inadequate management of femtocells, small base stations for home or business use, was to blame. In response, KT will allow customers to unsubscribe without penalties from Wednesday through January 13. This waiver extends to customers who canceled since September 1, with refunds provided as compensation.
However, new subscribers from September 1 onward will not qualify for the waiver. KT CEO Kim Young-shub, during a press briefing in Seoul, emphasized the company's commitment to data protection and expressed remorse for the anxiety caused to customers. Kim highlighted the seriousness with which KT regards the investigation's findings and the company's plans to prevent such incidents in the future.
To mitigate customer dissatisfaction, KT will offer 100 gigabytes of free data monthly for six months starting in January, alongside discounts at cafes and movie theaters. A two-year insurance program against voice phishing and scams will also be available, with senior users enrolled automatically.
To prevent future breaches, KT is forming an information security task force to strengthen its data management. The company plans to enhance its security accountability system and conduct regular inspections led by senior management. Over the next five years, KT will invest 1 trillion won (US$691 million) to overhaul its data security infrastructure and replace outdated equipment.
The breach resulted in unauthorized micropayments of 243 million won (US$169,000), impacting 368 users. Additionally, the compromised personal data of 22,227 users included mobile numbers, IMSI, and IMEI numbers. The government noted that KT's failure to meet contractual obligations allowed customers to request fee waivers upon unsubscribing.