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Legal Focus

JANUARY 2013

Data Protection Compliance UK

Continuing with our focus on Data Protection compliance, Lawyer Monthly speaks to Heledd Lloyd – Jones, Senior Associate and Head of Information Governance at Morgan Cole LLP.

according to reports, the Ico received more public complaints about the financial sector for the way their information was handled than any other sector. What are your opinions on this?

It is not really surprising that there has been a high volume of complaints regarding the financial sector. PPI mis-selling will have generated a very high volume of subject access requests made under the DPA, a proportion of which may not have been dealt with appropriately. In addition, the use of personal data for marketing purposes, by commercial organisations such as providers of financial services providers, and particularly the sending of unwelcome spam marketing, is a huge irritation to the public and it is very predictable that this kind of activity should give rise to complaints. On the other hand, financial services providers have long been required by FSA rules to adopt extremely robust data security measures. They have been subject to very significant financial penalties for data mishandling for many years and for this reason most financial services providers take data protection compliance very seriously and invest considerable resource in getting data protection compliance right. It’s interesting that despite the high level of complaints, financial services providers are under-represented in the ranks of organisation that have been served with Penalty Notices or have been invited to give compliance undertakings to the ICO.

How do you think companies can guard against a repeat of the problem Prudential encountered recently (a £50,000 fine relating to a mix up concerning the administration of the accounts of two customers with the same name and date of birth that led to tens of thousands of pounds of retirement funds ending up in the wrong account, an error which took several years to resolve even after being alerted to the issue several times)?

Ironically, the mix up at the Prudential seems www.lawyer-monthly.com

to have arisen as a result of a data cleansing episode, intended to update the Prudential database by identifying and deleting duplicate records. In carrying out this exercise it seems there was a failure to identify the possibility that two different customers might coincidentally share the same name and date of birth. The Information Commissioner recommends that “privacy impact assessment” should be conducted before any significant initiative involving the handling of personal data is undertaken. There is no specific legal obligation to carry out these assessments but it clearly makes sense to carry out appropriate assessment of privacy risks when embarking on projects that will involve the handling of persona data so that privacy risks can be identified and addressed at the earliest opportunity. It goes without saying that training and awareness raising in relation to data protection are also invaluable when it comes to reducing the risk of data mishandling.

are current data protection regulations simple to comply with or are there multiple complexities?

Some of the most important data protection compliance requirements are very easy to comply with but also all too easy to overlook. For instance, a high percentage of ICO penalty notices have been issued for very simple failings such as the failure to send letters and emails to the correct recipients, failure to check documents collected from shared printers before sending them out, failure to check attachments to emails before sending, failure to look after files and mobile devices when working remotely, failure to secure appropriate encryption for devices used to process sensitive personal information and failure to supervise contractors. The law in relation to data security is very straightforward; the challenges tend to be practical ones associated with getting the