30.07.2025
The decision by LHV to submit a notice to the Financial Intelligence Unit regarding the right to demand a contractual penalty in the amount of up to EUR 247.5 million has provoked an active discussion in society. This demonstrates that our decision to proceed was the right one.
Problem: unlawful access to information subject to banking secrecy through the Enforcement Register
On 1 July, Chancellor of Justice Ülle Madise pointed out that some state authorities have illegal access to information subject to banking secrecy through the Enforcement Register.
There are essentially two problems cited by the Chancellor of Justice. First, there is no control over how the state exercises its right of access and, second, it is questionable whether there is always a legal basis for access.
The state established the Enforcement Register with the aim of facilitating the collection of data necessary for the performance of the functions of the state. By establishing the register, the state gave various authorities the right to access information subject to banking secrecy. The choice of whether or not to provide information was not given to the banks.
Banks have operated under the belief that the rules imposed on us are in accordance with all applicable laws, including the Constitution. However, as a result of the inspection by the Chancellor of Justice, it became clear that the instrument and framework created by the state is incomplete. This requires an urgent response from the state and a solution.
LHV aims to protect the interests of its customers
Information subject to banking secrecy is the cornerstone of trust between a bank and its customers, in which intervention must be legally justified. The expectation of legitimate behaviour applies to everyone, including state authorities. Sanctions have been put in place to prevent violations of the agreed upon rules. By submitting a notice about the right to demand a contractual penalty, LHV is drawing attention to the consequences that disclosure of information subject to banking secrecy may have if there is no legal basis for doing so.
Society’s reaction clearly shows how important privacy is and why access to information subject to banking secrecy by state authorities must be strictly regulated.
To maintain the right to demand a contractual penalty, the law requires that the other party be notified of this right within a reasonable timeframe of becoming aware of the right. That is what LHV has done right now. This guarantees the right to file a claim within the normal limitation period of three (3) years. LHV expects that the shortcomings identified by the Chancellor of Justice will be eliminated more swiftly.
LHV is monitoring the resolution of the problem and, taking into account all the circumstances, assessing whether and to what extent it is necessary to submit a fine receivable. At the moment, we have issued a serious warning.
It is important to focus on solutions
The most important thing is to find a quick but meaningful and high-quality solution involving all relevant stakeholders directly or through representative organisations. We need to act today, not in the future. We would like to see that the requesting of data containing information subject to banking secrecy by state authorities, and their subsequent work, be carried out in a transparent, legal, and purposeful manner.
There is no place in Estonia for the violation of fundamental human rights. In a democratic society based on freedoms, a response to this matter is required. In a situation where a person entrusts their data, they have a reasoned expectation that the data will not be misused by state authorities. Everyone has the right to assume that state authorities have the right to access their most personal information.
We understand that the situation raises questions, and we are making an effort to ensure that our customers get answers to them as quickly and thoroughly as possible. The customer has the right to submit an inquiry about whether and by whom their data has been accessed. If we can confirm that the data has not been accessed, we will do so. In some cases, however, this is not possible. In that case, it is possible to address any questions to the authorities that may have carried out the inquiry.
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