FSA fines stockbroker £77,000 for poor data security

Merchant Securities Group Limited (MSG) is the first stockbroking firm to be disciplined by the FSA for lax data security. As part of an investigation, the FSA found that MSG had inadequate procedures for identifying customers contacting the firm via telephone. The firm often relied on being able to recognise a customer’s voice, or talking about personal holidays and hobbies, in order to identify their customer. It also sent personal account numbers in routine letters, which the FSA says could have been used with a customer’s name to access account information. In addition, the firm stor...