Data watchdog ready to bite
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Information Commissioner to take hard line on data protection.
2 August 2005 Government-appointed watchdog, the Information Commissioner, has threatened to fine thousands of UK accounting firms, which he believes are not complying with data protection laws.
A recent report by the Information Commissioner's Office (ICO) estimates that around half of the UK's 20,000 accounting firms have failed to report holding confidential client information on their computer systems.
The Data Protection Act, passed in 1998, requires all companies holding such information are required to notify the ICO. Those that flout the law can expect fines of up to £5,000.
The ICO has committed itself to raising awareness of the data protection but it has already shown its willingness to take legal action against those contravening the law.
Earlier this year the ICO took a legal firm to court for non-compliance with data protection laws. The firm was fined £3,150 and ordered to pay £3,500 towards the ICO's legal costs.
But this approach has been criticised by the Institute of Chartered Accountants, which complained that the hard line taken was overly aggressive.
The accounting profession has apparently been targeted because of a perceived laxness in complying with the Data Protection Act. In contrast, the ICO reports that almost all financial services companies had fulfilled their obligations.
The decision by the ICO to take court action also marks a change in policy. Previously, the ICO was reluctant to take legal action, preferring to concentrate on the handful of examples where data regulations had been willingly breached for commercial or personal gain.
