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Lenders get sloppier on data protection

Figures obtained by Which? Money suggest that the UK’s biggest banks could be breaching data protection rules with alarming regularity.

According to the consumer group, between August 2009 and August 2010, there were 515 complaints lodged with the Information Commissioner’s Office (ICO) about possible data protection breaches by eight of Britain’s biggest banks and building societies.

Which? Money research also suggests that just one in ten people are aware of the ICO, indicating that the volume of complaints could represent the tip of the iceberg.

Barclays was the bank with the most suspected breaches, with 116 complaints, followed by Lloyds TSB with 114, and Santander with 103.

Over half of all complaints arose from firms failing to provide customers with copies of their data, in the correct manner.

Other potential breaches included banks holding inaccurate data about customers, failing to follow security measures and disclosing data to third parties.

Which? Money points out that while data-related complaints about other organisations are declining, lenders appear to be getting sloppier, with complaints rising.

The organisation’s executive director, Richard Lloyd, says: “Banks and building societies hold incredibly sensitive information and the impact on customers can be serious if they mishandle it, from affecting credit ratings to leaving people open to fraud.”

He adds: “Regulators need to impose much tougher sanctions on firms who are lax with people’s data as the message clearly isn’t getting through.”

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