The recent case of Gerber v PSG highlights the critical importance of cybersecurity in financial planning. As we increasingly rely on technology to conduct business, we must protect ourselves and our clients from cyber threats.
The plaintiff in this case, Jan Jacobus Gerber, had entrusted his retirement funds to PSG Wealth Financial Planning. Over a decade, his share portfolio was managed by the company’s representative. However, in 2019, Gerber fell victim to email cybercrime, losing over R800,000 in investment.
The case was brought to the High Court in Johannesburg, where Judge Denise Fisher ruled in favor of Gerber. The judgment emphasized that PSG had not complied with its policy to protect clients against cybercrime. The judge acknowledged that cybercrime, particularly business email compromise, had become widespread, and it was essential for companies to take adequate measures to protect their clients.
PSG argued it could not be liable for the loss as Gerber’s computer system had been hacked. However, Judge Fisher rejected this argument, stating that PSG had failed to establish that it had complied with its contractual obligations to protect Gerber from cybercrime. Accordingly, the judge ordered PSG to pay Gerber R811,488.98, plus interest and costs.
Reflections on the Case
This case serves as a warning to financial services companies to take cybersecurity seriously. As we rely increasingly on technology to conduct business, the risk of cybercrime increases. Companies must take appropriate measures to protect their client’s assets.
The case also highlights the importance of clear communication and policy implementation. PSG’s failure to comply with its own policy to protect clients against cybercrime resulted in a significant loss for Gerber. As a result, financial services companies must ensure that their communication channels are secure and that clients’ personal and financial information is protected.
Additionally, this case is reminiscent of the need for nostalgia in business. As we move towards a more digital age, we risk losing touch with the human element of business. The courtesy call made by PSG’s assistant to let Gerber know the payment had been made is a small act of kindness that is often overlooked in today’s fast-paced digital world.
Companies must take adequate measures to protect their clients’ assets against cyber threats. Clear communication and policy implementation are critical in protecting clients’ personal and financial information. As we continue to move towards a more digital world, we must not forget the human element of business. Small acts of kindness and nostalgia can go a long way in building trust and maintaining strong relationships with clients.