Accounts merged after name mix-up by Prudential
Tens of thousands of pounds ended up in the wrong savings account following a mix-up over two customers with the same name and date of birth.
Insurance company Prudential mistakenly merged the records of the two customers in March 2007.
The mix-up, which continued for more than three years, resulted in large amounts of retirement savings ending up in the wrong account.
Prudential UK has been fined £50,000 by the Information Commissioner.
"This case would be considered farcical were it not for the serious sums of money involved," said Stephen Eckersley, the commissioner's head of enforcement.
A spokesman for the Prudential said that the confused names of the two savings customers were "not uncommon". He apologised and said that the customers had been compensated.
But he added that the problem originated from a mistake by one of the customer's financial advisers.
Years of inaccuracy
The two customers, who have not been identified, shared the same first name, the same surname, and the same date of birth.
This led to their two accounts being mistakenly merged by Prudential. It was 42 months later that the confusion was eventually resolved.
In the meantime, Prudential was told about the mistake on several occasions, the Information Commissioner's Office (ICO) said.
This included a letter from one of the customers involved in the mix-up pointing out that he had not changed his address for 15 years, so there was clearly a problem.
The fine imposed by the ICO related to the failure of the company to investigate fully when alerted to the problem.
It is the first penalty handed out by the ICO which does not relate to data being lost by an organisation.
Previous fines charged to other businesses have resulted from the loss of disks or memory cards containing customers' information.
"In this case two customer files were consistently confused and the company failed to remedy the situation despite being alerted to the problem on more than one occasion before it was finally resolved," said Mr Eckersley, of the ICO.
"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.
"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."
Prudential has now improved training for staff and updated its customer records processes, the ICO said.
A spokesman for the insurance company said: "We regret that this incident occurred and was not resolved more quickly. The circumstances surrounding this case are unique.
"The accidental merging of the two customers' details was not the result of system or process failures. It originally happened when the financial adviser of the first customer mistakenly provided the address of the second customer to us and requested that we change the first customer's registered address.
"We co-operated openly and fully with the review and we accept the fine imposed."