Seoul: The government on Wednesday announced plans to pursue "all available legal measures" against Coupang Inc. in response to the company's inadequate handling of a recent data leak. The U.S. e-commerce giant faced criticism for its passive approach during a parliamentary hearing, with officials accusing the company of downplaying the situation and evading accountability.
According to Yonhap News Agency, Science Minister Bae Kyung-hoon, who leads the task force investigating Coupang, expressed frustration with the company's cooperation, stating that Coupang had underreported the extent of the breach. While the company claimed only 3,000 accounts were affected, this contradicted initial reports of over 33.7 million compromised accounts. Bae emphasized the risks associated with the potential storage of deleted data on cloud platforms, noting that such information could facilitate cyberattacks.
The government's joint statement, along with relevant agencies, highlighted Coupang's failure to preserve crucial data and comply with legal requirements. Despite the company's assertion of conducting its investigation in consultation with the government, officials dismissed these claims as unilateral conclusions.
During the hearing, Coupang's legal representative Lee Jae-gul recounted interactions with South Korea's spy agency, which assisted in retrieving a suspect's laptop from a river in China. The agency's involvement was reportedly due to concerns about false information and the need to prevent further damage.
The Fair Trade Commission (FTC) also weighed in, with Chairman Ju Biung-ghi suggesting that Coupang's operations could be temporarily suspended due to the consumer data breach. The possibility of penalties, including business suspension, is under consideration as authorities continue their investigation into the leak's scope and potential victim compensation.
Public anger intensified following Coupang's announcement of a 1.69 trillion-won (US$1.17 billion) compensation package, criticized for its reliance on vouchers that necessitate subscriptions and purchases. The compensation plan faced backlash as an alleged attempt to deter further legal action.
Harold Rogers, interim CEO of Coupang Corp., addressed concerns at the hearing, asserting that the compensation package carried no conditions that would preclude future legal claims. However, Rogers faced scrutiny for his inability to ensure the attendance of Coupang founder Kim Bom-suk at the parliamentary investigation.
The National Assembly's Science, ICT, Broadcasting and Communications Committee responded by filing a complaint against seven Coupang officials, including Kim and Rogers, for violations related to parliamentary testimony. The committee accused Rogers of perjury, citing discrepancies between his statements and the intelligence agency's account of events.