The Information Commissioner has fined Prudential £50,000 for a mistake it made in 2007, and took 42 months to resolve. It all went wrong when the company confused two customers with the same name and birth date and merged their accounts.
So what happened next, and could it happen to you?
ConfusionThe problem started when the company mistakenly merged the retirement accounts of two customers with the same name and date of birth. To be fair to them, this came about because a financial adviser accidentally sent the first customer's address to the company - asking them to add it in as the second customer's new address.
However, the customers in question then made every effort to resolve the problem, but ran into brick walls every time. In one instance one of the customers wrote to the company saying that there was clearly a mistake, because he hadn't changed his address for the last 15 years.
However, Prudential failed to deal adequately with the mix up for more than three years, by which time thousands of pounds had been put into the wrong account.
FailuresThe fine was issued not because of the original mistake, but in the way it had subsequently been handled. Stephen Eckersley, the commissioner's head of enforcement said: "Inaccurate information on a customer's record, particularly when the record relates to an individual's financial affairs, can have a significant impact on someone's life. We hope this penalty sends a message to all organisations, but particularly those in the financial sector, that adequate checks must be in place to ensure people's records are accurate."
He added that Prudential had revisited staff training and improved the way customer records are handled as a result of the case. It should mean less chance of this happening at this particular company.
Would it happen to you?And while the company was keen to point out that the chances of falling foul of this sort of mistake are very small, mistakes do happen in all sorts of companies. Eckersley added: While data losses may make the headlines, most people will contact our office about inaccuracies and other issues relating to the misuse of their information." In fact, inaccurate data is the third most common complaint to the Information Commissioner.
The only way to protect ourselves from it is to keep up with the paperwork. We need to know what we expect from each company we have dealings with - from our insurer to our bank and pension company. We need to know roughly what money we expect to have in each instance, and we need to check every piece of paper that comes through the door.
It may not make for fascinating (or cheerful) reading, but it's the only way to stay one step ahead of a mix-up that could leave you substantially out of pocket until it is resolved.