Multiple choice

Which of the following is not correct regarding a bankers’ obligation to maintain secrecy of a customer’s account?

  1. As per provision of Banking Companies (Acquisition and Transfer of Undertakings) Act, 1970

  2. As per implied contract between bank and customer

  3. It continues during currency of the account

  4. None of the above
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D Correct answer
Explanation

As per Sec. 13 of “Banking Companies Acquisition and Transfer of Undertakings Act, 1970”, "every corresponding new bank shall observe, except as otherwise required by law, the practices and usages customary among bankers and, in particular, it shall not divulge any information relating to or to the affairs of its constituents except in circumstances in which it is, in accordance with law or practices and usages customary among bankers, necessary or appropriate for the corresponding new bank to divulge such information”. Maintaining secrecy is implied terms of the contract with the customer which bank enters into with the customer at the time of opening an account.

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