Don't Let Your Bank Bully You Into Divulging Confidential Information (How Do You Know The Person Purporting To Represent Your Bank Isn't A Conman?)

Increasing numbers of bank customers are receiving letters from people purporting to represent their bank. The letters demand to see passports, birth certificates and other forms of identification and warn of dire consequences if these aren't sent.

But beware!

Complying with these demands may severely damage your financial health.

The absurd demands now being made by banks of their customers are allegedly done to help fight the war on terrorism and money laundering.

This is nonsense.

The demands for private, confidential information are unlikely to have any effect on criminals or terrorists - who will invariably be able to supply van-loads of false or well forged papers. (As far as I am aware not one criminal or terrorist has yet been caught as a result of these absurd identity checks.)

I recently received a letter from someone claiming to represent the Bank of Scotland. I was asked to send an original document, such as a birth certificate, driving licence, rent card or current firearm certificate, to prove my identity and was told that this would help the bank fight crime and terrorism. But the letter came from someone I'd never heard of and from an address that was entirely new to me and doesn't appear on normal bank correspondence. The letter ended with a printed signature. I was asked to send the required private document to another address I'd never heard of.

I wrote back to the bank pointing out that since identity theft is now a major problem I did not want to release any personal documents until I received a signed letter from a senior bank officer who undertook to take personal responsibility for the security and safe return of my document. I also insisted that the bank should confirm that it would make no copies of my document.

I pointed out that my requirements were designed to protect the security of the bank, the nation and myself and added that the careless disposal of unwanted documents by financial institutions has been alleged to be a factor in the spread of identity theft. I explained that the letter purporting to come from the bank had a printed signature, that the address on the letterhead did not match the Bank's address on previous communications and that the address on the ready paid envelope I was sent bore no relationship to the Bank's address which I already had.

I heard nothing more from the bank - even though I sent a copy of the letter I received from the bank's alleged `Know Your Customer Team' to my normal contact.

Maybe the letter was a hoax and wasn't from the Bank of Scotland at all. Maybe a terrorist group was collecting birth certificates, driving licences, rent books and firearm certificates.

These alleged identity checks are a dangerous, time wasting nonsense.

Thousands of customers of major banks have already been tricked into supplying confidential information via the internet. Criminals use the information they obtain (such as passwords) to steal money or to hijack the identities of the people they trick. Fraudulent e-mails, tricking customers into parting with personal details, cost American banks and credit card companies $1.2 billion in 2003.

There is no reason why crooks won't use the ordinary mail to trick bank customers.

They don't even need to know for certain that you have an account with a specific bank. If they pretend to represent a major bank and send off 1,000 letters to 1,000 names taken at random there is a good chance that 10% of the individuals targetted will have an account with the bank that has been selected.

My advice: be very wary about sending information to anyone purporting to represent a bank.

Remember: demands for confidential information are nothing to do with the war on terrorism. Terrorists and money launderers will not be caught this way. Banks - and the Governments which force them to collect information - demand confidential information - and invade your privacy - for their own purposes.

Copyright Vernon Coleman 2004