Sony has been fined £250,000 (almost $400,000) by UK authorities following the conclusion of a report into data losses incurred when its PlayStation Network was hacked in 2011.

Update: Sony has confirmed it will appeal the decision, as per its comment at the bottom of this article.

The Information Commissioner’s Office (ICO) has levied the fine for “a serious breach of the Data Protection Act”; it is calling the case “one of the most serious” it has ever dealt with. Investigators have been critical of Sony’s lack of security, and today’s announcement says that the issue could have been prevented if its software had been up to date. It is also claimed that “technical developments” left many user passwords unsecured.

A statement issued today from David Smith, the Deputy Commissioner and Director of Data Protection, said that Sony’s protection systems were not up to the required standard and that the Japanese firm “should have known better”.

The hacking — which took place in April 2011 — compromised the personal details of 70 million users of the PlayStation Network and Sony’s Qriocity streaming service. The intruders were thought to have gained access to personal details, such as names, addresses, dates of birth and more. Credit card details were said to also be ‘at risk’, though Sony claimed soon after the incident that it had encrypted all financial data.

Here’s Smith’s statement in full:

“If you are responsible for so many payment card details and log-in details then keeping that personal data secure has to be your priority. In this case that just didn’t happen, and when the database was targeted – albeit in a determined criminal attack – the security measures in place were simply not good enough.

“There’s no disguising that this is a business that should have known better. It is a company that trades on its technical expertise, and there’s no doubt in my mind that they had access to both the technical knowledge and the resources to keep this information safe.

“The penalty we’ve issued today is clearly substantial, but we make no apologies for that. The case is one of the most serious ever reported to us. It directly affected a huge number of consumers, and at the very least put them at risk of identity theft.

“If there’s any bright side to this it’s that a PR Week poll shortly after the breach found the case had left 77 per cent of consumers more cautious about giving their personal details to other websites. Companies certainly need to get their act together but we all need to be careful about who we disclose our personal information to.”

Sony says it will appeal the decision. A company spokesperson provided the following statement to TNW:

Sony Computer Entertainment Europe strongly disagrees with the ICO’s ruling and is planning an appeal.

SCEE notes, however, that the ICO recognises Sony was the victim of “a focused and determined criminal attack,” that “there is no evidence that encrypted payment card details were accessed,” and that “personal data is unlikely to have been used for fraudulent purposes” following the attack on the PlayStation Network.

Criminal attacks on electronic networks are a real and growing aspect of 21st century life and Sony continually works to strengthen our systems, building in multiple layers of defence and working to make our networks safe, secure and resilient. The reliability of our network services and the security of our consumers’ information are of the utmost importance to us, and we are appreciative that our network services are used by even more people around the world today than at the time of the criminal attack.

Image credit: Jamiemc / Flickr