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Nationwide fined almost £1m

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15/02/2007

Nationwide, the UK’s largest building society, has been fined £980,000 by the Financial Services Authority (FSA).

The hefty charge has been slapped on the mutual mortgage and savings provider for lapses in information security procedures, which occurred when a laptop computer containing sensitive information about thousands of customers was stolen from an employee’s home.

The employee reported the theft to the police right away, but the building society was not aware for more than three weeks that the computer contained sensitive customer data.

The FSA found Nationwide guilty of failing to ensure it had adequate safety procedures and controls in place, potentially leaving its customers open to financial crimes.

Nationwide has not revealed exactly what kind of information was on the laptop, but has said it was for marketing purposes only, and did not include pin numbers or passwords.
It claimed no customers have suffered financial loss as a result of the theft.

Chief executive Philip Williamson said: “We have extensive security procedures in place, but in this isolated incident our systems of control were found wanting.
“We have made changes to fill the gap and improve our procedures further.”

Nationwide has written to its 11 million customers to apologise for the incident.

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