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Date of Release: November 10, 2008
Phone: 82-2-774-4050, Fax:82-2-774-4090
Contact: Lee Jeong-su, Secretary General
Kim eun-ok, Secretary
Companies require resident registration numbers even for simple inquiries.
Personal information is collected via prize giveaway events and free giveaway events on the street. Public awareness of privacy protection should be increased and an effective supervisory scheme is necessary to properly monitor personal information-gathering activities.
As personal information leaks continued to occur, involving major companies such as Hanaro Telecom, KT, LG Powercomm and GS Caltex, following the recent hacking into Internet Auction's website, Korea National Council of Consumer Organizations(KNCCO) and its member organizations have been striving to work out proper measures to protect consumers' privacy.
In this context, KNCCO has conducted a survey on cases in which consumers are asked to provide their resident registration numbers for no justifiable reasons, which has been a wide-spread practice. Based on the results of the survey, KNCCO has come up with ways to correct the situation.
○ Personal information collected through prize giveaway promotions is eventually used for telemarketing purposes, which needs to be regulated by a set of rules that can effectively govern personal information-gathering activities.
Personal information is routinely gathered at prize giveaway promotions or street marketing events that most people probably have participated in. Most of the event application forms carry a fine-print phrase at the bottom corner of the form, stating that you "agree to the use of your personal information"by the company. The personal information you give in the form will be provided to the collecting company's business partners and eventually be used for telemarketing purposes. This type of information-gathering prize-giveaway events are widely held not only at large discount stores and department stores but also at small-size supermarkets and even on the Internet. Free events for this purpose can be commonly found in places with heavy floating populations or major subway stations. Particularly, free giveaway events offer so-called "free baiting items" such as snacks, drinks and cosmetics samples to lure consumers and obtain massive amounts of personal information. This certainly requires that the government take actions urgently to address the problem.
○ Resident registration numbers are compiled by financial institutions during simple customer inquiries
Customers are asked to identify themselves by their personal information when they make general inquiries, file complaints or request simple customer services through online customer service centers run by banks or other major financial institutions. Even simple inquiries via automated response system(ARS) require provision of personal information i.e. resident registration number. Although resident registration numbers can be necessary for financial transactions, changes in service details or contract terms, etc., simple inquiries do not fall in that category. Specific cases of unjustifiable requests for personal information include customer service centers operated by Banks W, S, and H, the electronic customer service center of Company N and Bank J, and ARS services run by life insurance companies K, A, S, and D.
○ Customer benefits schemes such as point and mileage accumulating systems are found to serve as tools to collect resident registration numbers
Controversies have been also raised over the business practice requiring that consumers must provide their resident registration numbers to get point cards or membership cards designed to save a certain percentage of the purchase in the form of point or mileage, which are often touted as a token of commitment to greater customer service. Currently, this type of card is issued by the majority of membership-based service providers such as gas stations, department stores, discount stores and supermarkets, cosmetics shops, beauty parlors, book stores, fitness centers, private institutes, marriage information & dating service providers, video and book rental shops. Possible double issuance of such cards is cited by these businesses as one of the main reasons that make it difficult for them to change the system. However, such problem can be easily solved if each individual point card is assigned a specific serial number and if they create main key numbers by combining three items including the serial number, phone number and name.
○ Ujustifiable information collection in business transactions should be restricted
Other controversial cases include Internet shopping sites ultimately requesting personal identification for purchases by non-members even though it is clearly stating that non-members can make purchases without having to become a member, and insurance premiums-comparison sites requiring users to giving their resident registration numbers.
Most of commercial transactions can be conducted, based on such information as payment details, order numbers and tracking numbers. Still, personal identification is often required for purchases by non-members, which clearly constitutes an invasion of privacy. Internet websites that offer comparative data on insurance premiums are growing rapidly as direct services that allow consumers to compare different insurance products on the Internet and to purchase insurance policies over the phone, are becoming widely popular. Date of birth may be necessary to calculate insurance premiums but the entire resident registration number is not needed. Furthermore, personal date offered by users of insurance premium- comparison sites is used for telemarketing activities instead of getting deleted, which also needs to be addressed.
The above-listed cases well illustrate how personal information is required unnecessarily in private transactions. Surprisingly, resident registration number-collection is found even more often in the public sector. Since consumers do not know why they should give their resident registration number in various government forms and papers, they have no clue as to how they can identify and cope with problems.
Recently, as privacy protection is increasingly becoming an issue, the Ministry of Public Administration and Security announced its plan to enact a privacy protection law by the end of 2008. However, what really matters most is to raise the government's awareness of privacy protection and to equip companies that deal with personal information with a stronger sense of ethics. Of course, consumers who are the primary source of personal information should realize how important such information is and how the leak or theft of such information can lead to serious problems. Based upon this realization, consumers should pay greater attention and get involved more actively in addressing this issue. Building upon the survey of the aforementioned cases of privacy breach, the government should work out measures to ensure that only minimum personal data be required or to prohibit collection of such information. In addition, it is equally important to put in place a supervisory system to make sure that collected personal data are completely deleted and discarded.
KNCCO plans to urge companies customarily compiling resident registration numbers even in cases where they are not essentially necessary, to take corrective actions while implementing educational and promotional programs on a continuing basis to help consumers make better judgments in providing their personal information.
<Appendix> Cases of unjustifiable requests for personal data by category
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Category |
Specific examples |
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Online customer service centers(financial institutions) |
Voice of Customers (Bank W), customer service centers(Bank S and Bank H)electronic customer service center(Company N), Voice of Customers(Bank J) |
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ARS service |
Life insurance companies K, A, S, D, etc. |
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Point cards |
Large discount stores, major gas stations, department stores, book stores, fitness centers, beauty parlors, marriage information service companies, cosmetics shops, video and book rental shops, mileage service of airline companies |
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Prize-giveaway events and free gifts giveaway events |
Large discount stores, department stores, corporate marketing events(both on-line and off-line)Free auxiliary services by mobile communications companies and new product launch events |
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Online transactions |
Purchases by non-members at Internet shopping sites, payments for tickets purchased and reservations made online by non-members |
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Online services |
Insurance premium-comparison service(including auto insurance) |
 Member Organizations 
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National Council of the Green Consumers Network in Korea, Young Women's Christian Association of Korea, Korean Federation of Housewives' Clubs, Citizens' Alliance for Consumer Protection, National Council of Homemakers' Classes, Korea Consumer Education Center, Consumers Union of Korea, Korean Federation of Young Men's Christian Associations, Korea Consumer Affairs Institute | |
