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The country’s biggest building society has been fined almost £1 million after a laptop holding customers’ details was stolen from an employee’s home.

Nationwide was fined £980,000 by the Financial Services Authority yesterday for ‘failing to have effective systems and controls to manage its information security risks’.

The laptop was stolen last August while the employee was on holiday.

The information was needed by the member of staff for marketing purposes, Nationwide said. But the company admitted that an inquiry had not been launched until three weeks after the theft was discovered.

The fine is one of the highest the FSA has ever issued and the third highest handed out in the last year. The largest was the £17 million bill handed to Shell in 2004 for ‘market abuse’.

Philip Williamson, the company’s chief executive, sent a letter to all 11 million of Nationwide’s customers apologising for the security lapse: He also pointed out that the information on the computer was security protected and the theft had been opportunistic. ‘I would like to reiterate our apology to our members and assure them that we have taken action to tighten our already high security procedures,’ Mr Williamson said yesterday.

‘To set people’s minds at rest I wish to emphasise that there has been no loss of money from our customers’ accounts as a result of this incident.’

Phil Jones, assistant commissioner at the Information Commissioner’s Office said the decision would serve as a ‘wake up call’ to the financial services industry on security.

‘Members of the public trust banks and building societies with their personal information and breaches like this are completely unacceptable,’ he added.

Personal information must be kept securely and in line with other data protection principles.

‘If banks and building societies fail to treat people’s personal information securely, they risk being fined and ultimately they may lose the confidence of their customers.’