KPRC in Houston did a series of reports this past week on Washington Mutual in Houston shipping customer loan records to Juarez in Mexico. According to one of its sources, customer loan files were to be “imaged into a computer data bank then destroyed. ” The contractor providing the service is Affiliated Computer Services (ACS).
KPRC followed a shipment of documents as it left Houston and arrived in Juarez. What they found in their investigation was troubling, but not particularly surprising:
- Customers were not informed that their customer loan records were being shipped out of the country to Mexico, where they do not have the same privacy and data protection laws as the U.S.
- Washington Mutual allegedly lost track of over 100,000 loan files, i.e., it could not account for specific documents shipped from Houston to ACS’s facility in Juarez. Insiders report that all told, WaMu sent over 1,000,000 loan files to ACS.
- The reporters observed that boxes were left overnight in the ACS warehouse parking lot, boxes were stacked high in the loading docks, and although there was a guard at the front gate, there was no evidence that the parking lot was being patrolled. They could not determine whether it was bank files left in the parking lot or some other types of documents for some other client, and ACS did not answer their question on that.
The reports include some interesting comments by Rep. Ted Poe, who believes that consumers should have a right to know. It also includes mention of the fact that our federal government has the mechanism to conduct some oversight when bank records are outsourced — if not the will, manpower, or determination:
The government does have some oversight in this area. Banks like Washington Mutual are overseen by the Federal Office of Thrift Supervision. This office has the authority to send examiners to foreign countries to inspect facilities handling personal financial information from the United States. When Local 2 asked if the office has ever inspected any specific facilities in Mexico, officials refused to answer, citing agency policy.
“It bothers me, but it doesn’t surprise me that they won’t respond to the inquiry and they won’t respond, it seems to me, because they haven’t done it,” said Poe.