Monday, August 14, 2006

Canada Privacy Czar Probes If Banks Leaked Records Canada

Aug. 14 (Bloomberg) -- Canada's privacy commissioner is investigating whether a Belgium-based banking industry cooperative and the six largest Canadian banks broke privacy laws by sharing transaction records with foreign governments.

Privacy Commissioner Jennifer Stoddart is investigating Society for Worldwide Interbank Financial Telecommunication, or Swift, Stoddart spokeswoman Anne-Marie Hayden said by telephone in Ottawa. The U.S. Treasury Department has studied millions of international banking records obtained through Swift to track terrorist finances, the New York Times revealed in June.

``The risks resulting from personal information flowing across borders is something that we have been expressing concerns about for some time,'' Stoddart said in a statement. ``The Swift situation concerns privacy commissioners worldwide and is something we need to examine in more detail.''

The Canadian Internet Policy and Public Interest Clinic, a group based in the University of Ottawa's law department, filed a complaint against the Canadian banks covered by the investigation July 27, Hayden said.

The group targeted Royal Bank of Canada, Toronto-Dominion Bank, Bank of Nova Scotia, Canadian Imperial Bank of Commerce, Bank of Montreal and National Bank of Canada, according to a letter on its Web site.

``Any requests from the privacy commissioner we would fully comply with, and help with in any way we can,'' Royal Bank spokeswoman Beja Rodeck said by telephone from Toronto.

``The privacy of our customer information is very important to us and we would work with any'' probe, Toronto-Dominion Bank spokeswoman Kelly Hechler said by telephone, adding that the bank hasn't received ``notice of an investigation.'' Hechler referred further questions to the Canadian Bankers Association.

Other Banks

Officials at the other four banks didn't return phone calls seeking comment.

``We are aware that there is an investigation and the banking industry is fully cooperating,'' Caroline Hubberstey, a spokeswoman for the Toronto-based Canadian Bankers Association, said in an e-mail message. ``We are fully cooperating with the Privacy Commissioner's inquiries in any way possible.''

The Bank of Canada isn't a target of the investigation because there's no evidence it improperly relayed any information, Hayden said. The Toronto Star reported July 5 that Governor David Dodge would be questioned.

U.S. lawmakers in both parties have criticized the Bush administration for not keeping them more informed about a program in which Treasury sent requests to Swift about private banking transactions, which were passed along to the CIA for anti- terrorism purposes. Swift routes about $6 trillion daily between banks, brokerages, exchanges and other institutions.

U.S. Program

The U.S. program disclosed in June was the second to come to light in as many months that used technology to comb through personal records in the name of preventing attacks such as those that occurred on Sept. 11, 2001. In May, the U.S. admitted it was collecting telephone records in an effort to stop terrorism.

Canada's Privacy Commissioner reports to Parliament and has authority to take cases to court and force companies to change their practices or award damages, according to a background paper on the commissioner's Web site.

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