Contents.
What is bank secrecy?
This concept in the Ukrainian financial sector is regulated by Art. 60 of the Law of Ukraine “On Banks and Banking Activities”. The document states that banking secrecy is certain information relating to the financial position and business activities of a client (individual or legal entity) that became available to bank employees during the course of servicing. This concept establishes a clear framework for what exactly falls under the regime of secrecy and how this data should be protected.
What information is a bank secret
Banks possess a huge amount of data related to their customers. But not all of this information is secret. According to Ukrainian legislation, namely the Law of Ukraine “On Banks and Banking Activities” (part 2 of Article 60), banking secrecy includes:
- Information on bank accounts of clients, including correspondent accounts of banks with the National Bank of Ukraine.
- Information on transactions carried out in favor of or on behalf of the client and transactions made by the client.
- Financial and economic status of customers.
- Information on the organization and implementation of protection of the bank and persons in the bank's premises.
- Information on the organizational and legal structure of the client legal entity, its managers and areas of activity.
- Information on commercial activities of customers, trade secrets, projects, inventions, product samples and other commercial information.
- Information on the reporting of an individual bank, except for that which is subject to publication.
- Codes used by banks to protect information.
- Information about an individual who intends to enter into a consumer loan agreement obtained during the assessment of his or her creditworthiness.
Not a banking secret:
- Information subject to mandatory publication, the list of which is established by the National Bank of Ukraine.
- Information on debtors who are related parties to the bank and are overdue in fulfilling their obligations to the bank for more than 180 days.
- Data contained in the depository accounting system and available to the NBU and banks participating in the depository system of Ukraine.
It should be noted that the bank is obliged to guarantee the confidentiality of the bank account, account transactions and customer information. If bank employees leak confidential information classified as bank secrecy, the client may file a claim for compensation for material losses and non-pecuniary damage.
It is important to distinguish between commercial and banking secrets. To do this, you need to understand what a trade secret is and how it differs from a bank secret.
A trade secret is a secret information that has economic value for a company. It may include:
- production technologies and methods;
- business plans;
- financial information;
- customer bases;
- innovations and developments;
- marketing strategies.
The main difference is that trade secrets protect business information of companies, while banking secrets protect personal financial data of bank customers. Commercial secrets can belong to any company, while banking secrets are specific to the banking sector.
Who can access banking secrecy
Despite the strictness of the legal requirements, there are situations when a bank is obliged to disclose sensitive customer data. This can happen by court order, as well as at the request of law enforcement agencies in the framework of criminal proceedings. Access may also be granted to auditors, tax authorities and certain other government agencies, but only within their authority and in accordance with clearly defined procedures.
Why banking secrecy is important for the client
Banking secrecy is not just a formality, but an important tool for protecting clients' interests. It ensures the confidentiality of financial transactions, protects against unauthorised access to personal data, and guarantees that your financial history will not become public. This is especially important in times when information has become one of the most valuable resources.
How institutions protect banking secrecy
Financial institutions use a wide range of tools to protect information. They are obliged to:
- restrict access to confidential information to a certain range of persons;
- organise special processing of documents containing signs of banking secrecy;
- use technical means to protect data from unauthorised access;
- include confidentiality clauses in customer agreements.
In addition, banks constantly train their staff on the rules of handling confidential data and liability for their disclosure.
Thus, banking secrecy is not just a legal term, but a real mechanism for protecting the financial interests of each client. Knowing your rights in this area will help you feel more confident and secure in the financial world. Remember: money loves not only an account, but also silence. And banks do everything possible to ensure that your personal data is protected and you are always in plus 🧡
