BANKING TRANSACTION

Otago Witness, Issue 3613, 12 June 1923, Page 27

BANKING TRANSACTION

QUESTION OF SECRECY. LONDON, June 3. A High Court jury held that the wordo ■which appear in the pass hooks of hank customers to the effect that officers of the bank are bound to secrecy as regards the transactions of its customers did not apply to the ordinary course of business. A branch manager hah communicated with the manager of an engineering firm statin'* that one of his salesmen had passed a cheque on a slightly overdrawn account to a bookmaker. The jurv dismissed the salesman’s Blander claim, holding that the action of the bank did not constitute slander. The judge pointed out that a banker Could disclose the state of a person’s account if it were reasonable or justifiable without committing a breach of confidence. June 8. Since the High Court case there nas been a controversy whether bank officials are entitled in any circumstances to disclose the state of customers’ accounts. The Committee of the Clearing House of Bankers has now decided that the bond of secrecy between a bank and its customers is not modified by the judgment. The solicitors for the National Provincial Bank, which is concerned in the case, announce that any idea that banks are under no obligation to keep their customers affairs secret is contrary to their clients’ views. The bank does not approve of such answers as were given by their official under cross-examination, as

they imply a lack of such obligation. The Daily Express understands that the attitude of the banks it that they are bound to secrecy, but that when a client has an overdraft, and letters to his private residence are returned unopened thev are at liberty to make inquiries at his place of business.