In a move that has ignited controversy, South Korean e-commerce giant Coupang has unveiled a massive compensation plan worth 1.69 trillion won for victims of a recent data breach. The announcement on Monday follows a public apology from the company's founder but has been met with sharp criticism from lawmakers and consumer groups who accuse the firm of turning a security crisis into a business opportunity.
The Compensation Package and Public Apology
The compensation deal is aimed at holders of 33.7 million accounts affected by the data leak last month. Coupang stated that each impacted customer will receive company vouchers valued at 50,000 won. This plan was revealed just a day after Coupang founder Kim Bom issued his first public apology for the incident, pledging to expedite measures to make amends with users.
However, Kim has declined invitations to attend parliamentary hearings scheduled for Tuesday and Wednesday, citing prior commitments. This decision has added to the growing scrutiny surrounding the company's handling of the breach and its aftermath.
Mounting Criticism Over Voucher-Only Compensation
The core of the backlash centres on the form of compensation. Critics argue that offering vouchers redeemable only on Coupang's own platforms is inadequate and self-serving. Choi Min-hee, a lawmaker from the ruling Democratic Party and chair of the National Assembly's Science, ICT, Broadcasting and Communication committee, lambasted the move in a Facebook post.
She accused Coupang of "bundling coupons for services no one uses," suggesting the vouchers are tied to the company's less popular services. Choi Min-hee further asserted that Coupang appeared to be trying to leverage the crisis for commercial gain.
Consumer Groups Decry "Mockery" of Users
Echoing the political criticism, the Korea National Council of Consumer Organizations condemned Coupang's plan. The advocacy group described it as a marketing tool designed to encourage more spending rather than a genuine act of restitution. They stated the plan makes a mockery of consumers and downplays the severe nature of the data privacy violation.
When pressed for a response to the public outcry, Coupang declined to comment further. The company's silence has done little to quell the anger, as South Korea's parliament prepares for two days of hearings on the matter starting Tuesday, aiming to hold the e-commerce leader accountable.
The situation highlights the delicate balance companies must strike between providing meaningful redress after a security failure and avoiding actions that can be perceived as exploitative, especially in a highly competitive digital market like South Korea's.
