Banking secrecy: protecting and defending your rights

Your bank owes you confidentiality

Article L. 511-33 of the Monetary and Financial Code imposes a professional secrecy obligation on all credit institutions. This obligation covers all information that comes to the banker's knowledge in the course of his duties: account balances, credit transactions, transfers, cheques, the very existence of an account, accounting documents communicated by the customer. Respect for banking secrecy protects both the private life of individuals and the business secrecy of companies.

It is not a simple contractual clause. The Court of Cassation has reiterated that banking secrecy is a matter of professional public policy, independent of any stipulation between the parties (Cass. com., 16 January 2001, no. 98-11.744). In a landmark ruling, the highest court held that it survives the closure of the account and even the death of the customer (Cass. civ. 1re, 2 June 1993, no. 90-21.982). In other words, this obligation is perpetual.

If you are a private individual, company director or corporation and your bank has disclosed confidential information to a third party without any legal basis, you can take action. Our firm will analyse the lawfulness of the disclosure, identify the fault and hold the bank civilly or criminally liable.

Our firm handles

• Audit of the disputed communication: verification of the legal basis invoked by the bank
• Formal notice to the credit institution
• Civil liability action to obtain compensation for loss suffered (damages)
• Bringing a civil action in the event of a criminal breach of professional secrecy (art. 226-13 of the French Criminal Code)
• Challenging the legality of a communication imposed by a third party (tax authorities, civil court, creditor)

Breach of banking secrecy: penalties and remedies

Violation of banking secrecy exposes the perpetrator to criminal and civil penalties. Article 226-13 of the French Criminal Code, to which article L. 571-4 of the Monetary and Financial Code refers, provides for one year's imprisonment and a fine of €15,000 for individuals. Legal entities are liable to a fivefold fine of €75,000. In banking law, these penalties are in addition to any civil penalties imposed by the courts.

Here are a few concrete examples of the violations we deal with:

• A bank employee has passed on your financial details to a third party without your consent
• The bank has disclosed the balance of your account to a creditor outside any seizure procedure
• The identity of the beneficiary of a transfer or the reverse side of a cheque was communicated without complying with the conditions laid down by case law (Cass. com., 15 May 2019, no. 18-10.491)
• Confidential commercial information has been disclosed to a competitor
• Information covered by secrecy was produced in court without justification or proportionality

What we do in concrete terms

• Legal classification of the violation: determining whether the disclosure constitutes a criminal offence or a civil fault
• Assessing the loss and compiling evidence
• Amicable negotiation with the bank at fault
• Legal action before a court of law or criminal complaint with civil party status

Request for waiver of banking secrecy: check, challenge, defend yourself

Banking secrecy is not an absolute principle. The law provides for specific cases in which the bank is obliged to disclose information without the customer's consent. The legal exceptions include criminal proceedings, the tax authorities' right to obtain information (art. L. 83 of the Book of Tax Procedures), the reporting of suspicions to Tracfin as part of the fight against money laundering and the financing of terrorism (art. L. 561-15 of the Monetary and Financial Code), and the seizure of assets by a creditor with an enforceable title.

In tax matters, for example, banking secrecy is completely unenforceable: the bank cannot refuse to respond to the authorities. In the event of a tax audit, the issue is not to block the communication, but to verify the legality of the request and anticipate its consequences in terms of tax fraud or evasion.

But not every request is legitimate. The case law of the Cour de cassation requires a genuine proportionality test between the claimant's right to evidence and the protection of secrecy (Cass. com., 15 May 2019, no. 18-10.491). In this ruling, the high court accepted that disclosure of the back of a cheque to a drawer who had been the victim of fraud could be ordered, provided that it was essential to the exercise of the right to evidence and proportionate to the interests of the beneficiary protected by secrecy.

Our role when faced with a waiver request

• Check the legal basis of the claim and its compliance with the Code of Civil or Criminal Procedure
• Challenging disproportionate or unjustified claims before the courts
• Assisting credit institutions in managing judicial requisitions, tax audits and Tracfin declarations
• Defending the rights of guarantors and heirs who come up against banking secrecy to obtain the documents they need to defend themselves
• Invoking the legitimate impediment when the legal conditions for waiver are not met