Dormant Bank and Building Society Accounts Bill [HL]

Banks and building societies are normally under a duty not to disclose information about their customers’ affairs to third parties without the customers’ consent. That is an important obligation subject to only very limited exceptions. The proposed agency arrangements, under which claims for repayment against the reclaim fund will be handled by a customer’s original bank or building society, mean that customer records will need to be retained by the original institution to verify claims on the reclaim fund’s behalf. There should be no need for the confidential customer information to be transferred routinely to the reclaim fund. The Government recognise that there may be exceptional circumstances in which a customer is unable to seek repayment from their bank or building society and the claim may need to be handled directly by the reclaim fund, which would then require access to information. Nevertheless, it is envisaged that this would operate only where claims need to be properly verified in order to enable the reclaim fund to fulfil its function to repay the customer. The amendment would enable a bank or building society to share with the reclaim fund confidential information that is not directly related to customer repayments. We do not think that is necessary. We do not foresee circumstances, apart from those I have identified, where the reclaim fund may require confidential information. We want as far as possible to restrict the flow of information to just that consideration. I hope the noble Baroness will recognise our concerns in this respect.