Personal data protection: liabilities of financial organizations in regard with their customers. Whether the use of a client's personal data for the reasons other than the intended purpose by financial institutions is lawful under Armenian law where the data was collected for conducting client due diligence based on the "Know Your Customer" principle

Abstract

This paper aims to provide a comprehensive analysis of data protection law in the Republic of Armenia and international practices regarding the engagement of state liability for legislative changes. The reasons how banks and financial organizations solicit customer personal information based on the “Know Your Customer” principle required by law will be discussed. This paper will address a very important question of why financial companies should maintain and use their customers’ personal data without going beyond the scope of “Know Your Customer” principle. The importance of creating sufficient resources to protect customers’ personal data when using online lending will be discussed. The specific question is whether the use of a client’s personal data for the reasons other than the intended purpose by financial institutions is lawful under Armenian law where the data was collected for conducting client due diligence based on the “Know Your Customer” principle.