[2022 National Audit] "From Next Year, Open Banking Incidents Will Result in Blanket Restrictions on Transactions Under My Name"

2022 Political Affairs Committee Financial Services Commission Audit Data
Preparing 'Facial Recognition System' to Prevent ID Theft

[Asia Economy Reporter Sim Nayoung] The Financial Services Commission announced on the 6th, in materials released for the National Assembly audit, that it will establish a system by the first half of next year allowing victims of open banking electronic financial accidents to collectively restrict transactions on accounts under their name. This was in response to a query from Kang Byung-won, a member of the Democratic Party of Korea, regarding the suggestions for improvement of open banking electronic financial transaction issues submitted by Kookmin Bank to the Financial Services Commission in April last year.

At that time, Kookmin Bank raised the issue that "even if a customer reports an electronic financial accident or changes their account password at their bank due to a personal information leak incident, it is still possible to newly register or withdraw from open banking at other banks or fintech companies." Accordingly, they proposed that "a joint IT network process should be established so that all open banking transactions can be suspended when a customer reports an accident at the institution they use, separate from the electronic financial accident report."

In addition, in response to Kim Jong-min, a member of the Democratic Party of Korea, pointing out that "the non-face-to-face real-name verification system in financial transactions is vulnerable to ID forgery," the commission stated that it will introduce an ID authenticity verification system and a facial recognition system.

The Financial Services Commission said, "In the process where financial companies verify customers using IDs, we will check the authenticity by comparing the text and photo information on the ID copy with the information registered at the issuing institution," and added, "We are reviewing the introduction of a facial recognition system that compares the photo on the submitted ID with the face of the customer submitting the ID to prevent identity theft."

Meanwhile, last month, the government decided to limit the number of lines an individual can open at all telecommunications companies to three per month starting this month to combat voice phishing. Plans are also underway to reduce the deposit limit using only an account number without a card or passbook from 1 million won to 500,000 won. Additionally, cash withdrawals of funds sent without a medium will be limited to 3 million won per day.