A glitch in big-four bank First national Bank's (FNB's) mobile app has exposed personal information of customers applying for home loans using the digital platform. It was discovered that if an FNB client used the mobile app to apply for a home loan, they would easily see the personal details of other home loan applicants. The exposed data includes personal identifiable information, such as names, identity numbers and contact details. An FNB client who discovered the exposed data has since informed the Information Regulator, asking it to take the necessary measures against the big-four bank. "I wish to lodge a complaint against First National Bank in respect to a breach of personal information through their banking application," the client reported to the regulator. "Whilst applying for a home loan through the service, I noticed that I was able to access other individuals' personal information, such as ID numbers, contact details and various financial information, which is visible to other applicants, including my personal information. "I have documented this by way of screenshots and have evidence to support this data breach. I believe my rights in terms of the POPI Act [Protection of Personal Information Act] have been infringed and poses a huge personal security risk," stated the client. "Your e-mail contents have been noted and will be addressed with the responsible party," says a complaints and investigations officer of the Information Regulator in an e-mail.Under South Africa's data privacy law, the Protection of Personal Information Act (POPIA), organisations must inform the Information Regulator if they expose the personal information of data subjects to unauthorised third parties without their approval. FNB has acknowledged exposing the personal information of its clients, saying it is in the process of notifying the relevant authorities, as well as those who have been impacted. While the financial institution has rushed to disable the app functionality in question, it did not disclose how many customers were impacted. Says the bank in a statement: "FNB is aware of a technical error that made the information of certain home loan applicants, such as full names and ID numbers, visible to other home loan applicants who logged in via our digital channels. FNB takes the privacy and protection of customer information very seriously, and the affected functionality has since been temporarily disabled to resolve the root cause of the issue. We are in the process of contacting the affected customers and the appropriate regulator. Customers requiring any assistance can contact us through Secure Chat on the FNB app." FNB recently made sweeping changes to its brand, including a redesign of its popular banking app. The FNB app, introduced more than a decade ago, saw its active transacting base exceed 4.7 million customers, based on results for the year ended 30 June 2022. The data exposure comes at a time the Information Regulator is receiving an unprecedented number of reports about data breaches in South Africa. Speaking during the Governance, Risk and Compliance 2023 conference last week, advocate Pansy Tlakula, chairperson of the Information Regulator, revealed that data breaches are a big problem in this country - much bigger than people think. "Every public body, every private body that has suffered a security compromise or data breach has to notify us - there is no threshold. Even if one person was breached, they still have to notify us. If you look at 500 (it's 564 to be precise), it means that in a month, this country suffers about 56 data breaches - major and minor ones," she revealed. "I think we are one of the highest in the world with data breaches."POPIA sets down firm frameworks that companies have to abide by to avoid fines, criminal persecution and potential reputation loss. Breaching the rules and regulations outlined by this Act can have serious financial implications for the business - repercussions that can cost a fortune and have long-lasting consequences, such as reputational damage. The Act makes provision for fines of up to R10 million and a jail sentence of up to 10 years, depending on the seriousness of the breach.Apply your knowledge of the governance of the risk management programme to (10) discuss the three (3) layers of involvement to manage information risk in the above FNB case..Write an answer for 10 marks

1 answer

In the context of the First National Bank (FNB) data breach, effectively managing information risk involves a structured governance framework that incorporates three key layers: organizational, operational, and technological. Each layer plays a critical role in protecting personal information and mitigating potential risks associated with data privacy breaches.

1. Organizational Layer

At the organizational level, the governance of information risk is primarily focused on establishing policies, procedures, and a framework that supports data protection efforts. In the FNB case:

  • Policies and Compliance: FNB must ensure that it has comprehensive data protection policies in place that comply with the Protection of Personal Information Act (POPIA). These policies should outline the obligations regarding data handling, user consent, and breach notification.

  • Roles and Responsibilities: Clearly defined roles and responsibilities are crucial. The bank should appoint a Chief Information Officer (CIO) or Data Protection Officer (DPO) tasked with overseeing information security initiatives and ensuring adherence to legal requirements.

  • Training and Awareness: Regular training sessions for employees on data protection regulations, potential risks, and best practices can bolster the organization's resistance to data breaches. Employees should be made aware of how to handle sensitive information and recognize potential threats.

2. Operational Layer

The operational layer involves the implementation and management of systems and processes to support the organization's data protection strategies. In the case of FNB, this includes:

  • Risk Assessment and Management: Conducting regular risk assessments to identify vulnerabilities within the mobile app and other platforms is imperative. This includes evaluating potential risks associated with data access and the exposure of personal identifiable information (PII).

  • Incident Response Planning: Developing a robust incident response plan is essential. FNB should have a predefined protocol for responding to data breaches, including immediate action steps to mitigate damage, such as disabling the app functionality that led to the data exposure.

  • Monitoring and Auditing: Continuous monitoring of applications and systems to detect unauthorized access or anomalies can help to prevent future breaches. Regular audits can also ensure compliance with policies and identify areas for improvement.

3. Technological Layer

The technological layer includes the deployment of advanced tools and systems designed to protect information assets. For FNB, this might involve:

  • Data Encryption: Employing encryption technologies to protect sensitive information both in transit and at rest can prevent unauthorized access even in the event of a breach.

  • Access Controls: Implementing strong access control measures can help restrict who can view sensitive information. Role-based access controls (RBAC) should be used to ensure that customers only have access to their personal information.

  • Security Software: Utilizing state-of-the-art security software, such as intrusion detection systems (IDS) and firewalls, can help safeguard against external cyber threats and vulnerabilities that might lead to data breaches.

Conclusion

In conclusion, managing information risk in FNB's case requires a multifaceted approach that encompasses organizational policies, operational procedures, and advanced technological defenses. By addressing each layer, FNB can work towards safeguarding customer information, ensuring compliance with data protection laws, and mitigating the risks of future breaches. This holistic governance of risk management not only protects individual client data but also helps preserve the bank’s reputation and financial stability in an increasingly data-sensitive world.