Mobile phone giant Orange and catalogue firm Littlewoods have mishandled customers' personal information in breach of the Data Protection Act, the UK Information Commissioner's Office has found.
An investigation by the ICO revealed that Orange Personal Communication Services was in breach of the act because it was not keeping its customer data secure. The probe found that new members of staff were allowed to share user names and passwords when accessing the company IT system.
In a separate probe, the ICO ruled that Littlewoods Home Shopping had failed to process data in line with the act after investigating a customer's attempt to stop the company using her personal details for direct marketing. Despite her requests Littlewoods continued to send her marketing materials, the ICO found.
The watchdog has now ordered both companies to sign a formal undertaking to comply with the principles of the act, warning that a failure to stick to the terms of the agreement could result in further action including prosecution.
Mick Gorrill, head of regulatory action at the ICO, said: "Organisations that process individuals' personal information must do so in compliance with the Data Protection Act. If they do not, they not only risk further action from the information commissioner but also risk losing the trust of their customers."
The slapped wrist for Orange and Littlewoods is likely to renew concerns that the ICO is a largely toothless watchdog, with little scope for tough action. In March, the information commissioner strongly criticised 11 banks that dumped customers' personal data in outside bins - but as with Orange and Littlewoods, the watchdog administered only a warning and an instruction that the banks should undertake to comply in future.
Last month information commissioner Richard Thomas called for powers to allow his office to carry out inspections and audits to check compliance with the data protection law. At present he must gain consent before launching an inspection.