HSBC bank
HSBC bank in Hong KongiStock

HSBC has caused an uproar in Hong Kong after it insisted it had the right to look into its customers' safe deposit boxes. The bank said that it had the right to dispose of any items it considered illegal or offensive in nature or likely to be deemed a nuisance.

In a letter sent to clients last month, the bank told its customers that under new conditions of its leases for the safe deposit boxes, it had the right to dispose of any items in any way it saw fit and without prior notice or consent if they fell into these categories. South China Morning Post, which reportedly saw a copy of the letter, said that the bank failed to clarify what it meant by "offensive" or "nuisance." It also did not say under what circumstances bank staff would be able to inspect the boxes.

The bank has asked clients to sign and return the letter within one month to confirm their acceptance of the updated conditions so that "we [HSBC] can continue providing you with the Safe Deposit Locker services." There are now concerns that the bank will terminate the leases of customers who fail to sign the letter.

Barrister Neville Sarony said the revised conditions gave the bank "totalitarian rights" over the contents of the boxes and offended against the concept of personal privacy. "This is a ridiculous and grossly invasive power which makes a nonsense of the whole purpose of a safety deposit box," he said.

"Granting HSBC the unlimited right to snoop into your box and dispose of its contents without prior warning makes a total nonsense of the word 'safe'," the barrister added.

Bank maintains it is doing the right thing

HSBC, however, is adamant that what it is doing is right. The bank's spokesman in Hong Kong said that the nature of the locker service meant that it had the potential for "misuse for criminal purposes." He continued: "HSBC has a clear commitment to defend the integrity of the financial system against activities such as money laundering."

The spokesman said that the lease conditions had been updated to strengthen the bank's defences against financial crime and to facilitate cooperation with law enforcement agencies. "We want to reassure... these changes to the terms and conditions will not in any way reduce the security and privacy of our safe deposit locker service."

The bank's reassurance that only the client and his or her appointed representative would have access to the locker failed to give any comfort to its customers. A client who received the letter through the post asked: "Would a customer's collection of autographed pornography be considered 'offensive' by the bank and be disposed of?"

He went further: "Does it mean that the staff can now access any of our safe deposit boxes at will, rifle through our personal belongings and make a subjective decision of what they might consider 'offensive' and then dispose of the items without our consent?"

South China Morning Post said that safe deposit boxes are in short supply in Hong Kong and there is currently a long waiting list at most banks. The banks charge up to HK$20,000 (£1,760, €2,312, $2,574) per year for the use of one box.