The EU and the US have signed an agreement under which the EU will provide financial information of alleged terrorists, although legal experts have argued it may undermine UK data protection laws.
The signing of the SWIFT agreement last night means the American Treasury Department can demand financial data originating in the EU to help it to investigate, search for, identify and prosecute alleged terrorists and their financial backers.
Signing the document on behalf of the EU, Spanish interior minister Alfredo Pérez Rubalcaba said it was "a good agreement" for trying to combat terrorism.
"In our view this is an excellent agreement, which reflects the concerns which the European Parliament raised, and we have reached it in dialogue with the Parliament," he added.
Michael Dodman, the charge d'affaires of the US mission to the EU, said, "It is a very solid agreement and we want it to be applied fully as it is important for the security of the European Union and the US."
However, Robin Fry, a partner at law firm Beachcroft LLP, argued that the new agreement undermined the UK's data laws and could be harmful to citizens.
"Our careful construction of balanced data protection laws overseen by the UK's Information Commissioner is meaningless if such private information can be dumped into an unknown warehouse overseas," he said.
"Although it's always been the case that personal information can be disclosed without consent for preventing or detecting crime, most people would be shocked to know that all such bank information is passed over for processing by a foreign power."
He added that although the US had committed to judicial redress if data is unlawfully dealt with, "that's of no practical help to individuals in the UK".
Doubts over the agreement have also been raised by officials worried about how the data will be supplied to the US, with European data protection supervisor Peter Hustinx calling for the EU to be more open about the need for the scheme in the first place.
"In view of the intrusive nature of the draft agreement, which allows transfers of data in bulk to the US, the necessity of such a scheme should first be unambiguously established, especially in relation to already existing instruments," he said.
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