Nationwide retailer fined half a million pounds for failing to secure information of at least 14 million people

The Information Commissioner’s Office (ICO) has fined DSG Retail Limited (DSG) £500,000 after a ‘point of sale’ computer system was compromised as a result of a cyber-attack, affecting at least 14 million people.

An ICO investigation found that an attacker installed malware on 5,390 tills at DSG’s Currys PC World and Dixons Travel stores between July 2017 and April 2018, collecting personal data during the nine month period before the attack was detected.

The company’s failure to secure the system allowed unauthorised access to 5.6 million payment card details used in transactions and the personal information of approximately 14 million people, including full names, postcodes, email addresses and failed credit checks from internal servers.

DSG breached the Data Protection Act 1998 by having poor security arrangements and failing to take adequate steps to protect personal data. This included vulnerabilities such as inadequate software patching, absence of a local firewall, and lack of network segregation and routine security testing.

In January 2018, the ICO fined Carphone Warehouse, which is part of the same company group, £400,000 for similar security vulnerabilities.

Steve Eckersley, ICO’s Director of Investigations, said:

“Our investigation found systemic failures in the way DSG Retail Limited safeguarded personal data. It is very concerning that these failures related to basic, commonplace security measures, showing a complete disregard for the customers whose personal information was stolen.

“The contraventions in this case were so serious that we imposed the maximum penalty under the previous legislation, but the fine would inevitably have been much higher under the GDPR.”

The ICO considered that the personal data involved would significantly affect individuals’ privacy, leaving affected customers vulnerable to financial theft and identity fraud. The ICO received 158 complaints between June 2018 and November 2018 from DSG’s customers. As of March 2019, the company reported that nearly 3,300 customers had contacted them directly in relation to this data breach.

Mr Eckersley said:

“Such careless loss of data is likely to have caused distress to many people since the data breach left them exposed to increased risk of fraud.

“We recognise that cyber-attacks are becoming more frequent, but organisations have responsibilities under the law to take serious security steps to protect systems, and most importantly, people’s personal data.”

Full details of the investigation can be found in the Monetary Penalty Notice.

Notes to Editors

1. The Information Commissioner’s Office (ICO) is the UK’s independent regulator for data protection and information rights law, upholding information rights in the public interest, promoting openness by public bodies and data privacy for individuals.
2. The ICO has specific responsibilities set out in the Data Protection Act 2018 (DPA2018), the General Data Protection Regulation (GDPR), the Freedom of Information Act 2000 (FOIA), Environmental Information Regulations 2004 (EIR) and Privacy and Electronic Communications Regulations 2003 (PECR).
3. The General Data Protection Regulation (GDPR) is a recent data protection law which came into beingin the UK from 25 May 2018. Its provisions are included in the Data Protection Act 2018. The Act also includes measures related to wider data protection reforms in areas not covered by the GDPR, such as law enforcement and security. The UK’s decision to leave the EU will not affect the commencement of the GDPR.
4. Due to the timing of certain incidents in this investigation, civil monetary penalties have to be issued under the previous legislation, the Data Protection Act 1998. The maximum financial penalty in civil cases under former laws is £500,000.
5. Under past and current law, the ICO can take action to change the behaviour of organisations and individuals that collect, use and keep personal information. This includes criminal prosecution, non-criminal enforcement and audit.
6. Since 25 May 2018, the ICO has the power to impose a civil monetary penalty (CMP) on a data controller of up to £17million (20m Euro) or 4% of global turnover.
7. The data protection principles in the GDPR evolved from the original DPA, and set out the main responsibilities for organisations. Article 5 of the GDPR requires that personal data shall be:
   • Processed lawfully, fairly and in a transparent manner in relation to individuals;
   • Collected for specified, explicit and legitimate purposes and not further processed in a manner that is incompatible with those purposes;
   • Adequate, relevant and limited to what is necessary in relation to the purposes for which they are processed;
   • Accurate and, where necessary, kept up to date
   • Kept in a form which permits identification of data subjects for no longer than is necessary; and
   • Processed using appropriate technical or organisational measures in a manner that ensures appropriate security of the personal data.”
   • Article 5(2) requires that “the controller shall be responsible for, and be able to demonstrate, compliance with the principles.”
   • Civil Monetary Penalties (CMPs) under past and current law are subject to a right of appeal to the (First-tier Tribunal) General Regulatory Chamber against the imposition of the monetary penalty and/or the amount of the penalty specified in the monetary penalty notice.
8. Any monetary penalty is paid into the Treasury’s Consolidated Fund and is not kept by ICO.
9. To report a concern to the ICO go to ico.org.uk/concerns.