§ 3.4 p.m.
§ [The Question was as follows:
§ To ask Her Majesty's Government whether they have powers to stop financial institutions calling themselves "banks" in the course of advertising for funds from the general public, when in practice their business is not such as is usually understood by the public to be covered by the description "banking".]
§ THE MINISTER WITHOUT PORTFOLIO (THE EARL OF DUNDEE)My Lords, the answer is, No. The powers of the Board of Trade in regard to the use of the word "bank" are in respect of its use as part of a company name or of a business name. It has been the policy of the Board of Trade since the Companies Act of 1947 not to allow a company name or a business name to be registered if it includes the word "bank" unless the facts of the case justify its use. There is, however, no power to prevent the use of the word as part of a business description. This is a defect in existing legislation which the Board of Trade have noted for consideration when the opportunity presents itself.
LORD HAWKEMy Lords, I thank my noble friend for his Answer. In default of this legislation, I take it that the Government's policy must be caveat depositor.
§ THE EARL OF DUNDEEMy Lords, I stated that there is no power to prevent the use of the word "bank" in a business advertisement or anything of that kind. That will have to wait until we 1356 get an opportunity, of which I think there may be some prospect before long, of new legislation on the subject.
§ LORD CHORLEYMy Lords, the noble Earl, the Minister, will be aware that in the Moneylenders Act there is a provision which prevents a certain class of man from describing himself as a "bank". Surely, there should not be any difficulty in extending that to other people.