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AMERICAS: ARGENTINA

Court Restrains Bank From Providing Clients’ Personal Information to Other Companies
Author: Dámaso A. Pardo, Pérez Alati, Grondona, Benites, Arntsen & Martínez de Hoz (h)

Based on privacy rights, an Argentinean Court made a historic ruling that banks are forbidden from transferring their clients’ personal information to other groups even within a bank’s organization for advertising or direct marketing purposes because this violates the Argentinean Data Protection Act.

The Argentinean Data Protection Act §§ 5 and 11.25.326 provides that total protection is available for a consumer’s personal information that exists in a bank’s files or data bases.  Consequently, express and written consent from a consumer is needed before a bank may transfer a client’s personal information to a third party for advertising or marketing purposes.

Here, Citibank NA sent an opt-out letter to all its consumers informing them that Citibank and all the Citigroup companies intend to use consumers’ personal information for marketing purposes unless a consumer expressly opposed such use and returned a communication to that effect to Citibank instead of using an opt-in notice whereby a consumer would have to give their permission in order for Citibank to use their personal information for advertising or marketing purposes.

The Consumers Association requested an injunction to stop Citibank from using the opt-out notice procedure claiming that it violated a consumer’s constitutional protections under the Argentinean Data Protection Act §§§ 5, 11 and 27.25.326 and the National Constitution § 43.  Citibank claimed that it had a right to use the opt-out notice procedure based on the Habeas Data Law Rule No. 25.336.  While, the Court of Appeals for Commercial Matters understood that it would be difficult for the majority of customers to complete and present opt-in notices to Citibank to protect their personal information, the Court ordered Citibank to stop the opt-out notice procedure.