Squirming out – The Standard

05Aug10

The importance of whistleblowers.

Squirming out – The Standard.
Thursday, August 05, 2010
Dennis Chong

Octopus Cards chief executive Prudence Chan Pik-wah stepped down yesterday to quell the uproar over the sale of private data, but the company’s board was accused of allowing her a dignified exit.

She will stay with the company for another six months to help respond to issues raised by the sale of private data.

Despite a promise to turn over data sales revenue exceeding HK$44 million to the Community Chest and a personal “sorry” from its CEO, a legislator worries that Chan could influence the probe that has been launched into the fiasco.

The Octopus board said last night it has accepted Chan’s resignation.

A senior executive from major shareholder Mass Transit Railway Corp, David Tang Chi-fai, will serve as interim chief executive before Chan officially departs in February “to ensure a smooth transition.”

But critics branded the resignation as a show, saying Chan will still have the power to intervene in the company’s review of data protection policies.

Legislator Wong Kwok-hing described Chan’s exit as a “dignified departure,” which gives him the impression the company is trying to sidetrack criticism.

“Chan is to stay for another six months and could affect the handling to the issue,” Wong said. “The company has not said how it will reform. I have strong reservations about the arrangement.”

He said: “More than one person is responsible,” adding he will continue his push in the Legislative Council for greater scrutiny.

Chan issued a statement last night, saying she is sorry. “I have given tremendous thought to the events over the past few weeks. I believe the current issue could have been better handled.”

Last night, media confront Chan as she was getting into her car. She smiled and thanked the public for their concern but refused to say whether she resigned under pressure. Before getting back into the car, she urged the public to continue using Octopus Cards.

Following a five-hour board meeting, Octopus Holdings chairman Lincoln Leung Kwok-kuen said the company will ensure data sold to merchants is deleted. The company will also re-focus on its electronic payment business to restore goodwill.

Leung admitted the company does not have an exact figure on how much was made from data-selling business, which began in 2002.

He said an auditor will be called in to figure out the amount, which will include the HK$44 million it previously reported to have generated between 2006 and 2010.

Leung stressed Chan’s six-month notice period is stipulated in her contract.

She will be assisting in responding to queries arising from the issue and in reviewing data protection practices.

Asked whether he should step down as chairman, Leung said the company will be in a better position if he stays.

Chan was accused of making contradictory statements on whether Octopus was selling the personal data of cardholders. On July 7, Chan said the firm would not sell customer data to any third party. But a week later, a former insurance agent said CIGNA had bought the data of 2.4 million cardholders for marketing purposes. On July 20 Chan admitted Octopus sold personal data to two merchants.

In a Privacy Commission meeting on July 26, Chan further admitted the company earned HK$44 million over four and a half years by sharing personal data with six merchants.

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