PLANS by Lloyds TSB to transfer hundreds of Hampshire jobs to India face an unprecedented legal challenge from a customer.

The unnamed customer claims the bank's controversial cost-cutting plans infringe data protection legal requirements.

The charge against Lloyds TSB is that India does not conform to stringent standards legally required by the Data Protection Act of 1998.

Fears have been raised that off-shoring work to the sub-continent could result in highly-sensitive customer information falling into the wrong hands.

As reported by the Daily Echo, about 350 jobs at Lloyds TSB's Solent Business Park centre, in Whiteley and at its C&G centre in Segensworth, near Fareham, could go by the end of the year if the company decides to move operations to Bangalore in India.

More than 3,000 people from Fareham have signed a petition campaigning against any move.

The customer is asking the government's information commissioner to rule on whether Lloyds TSB is acting legally when transferring sensitive personal data abroad.

He is receiving the support of solicitors Bindmans and Lloyds TSB's Group Union, which represents more than 45,000 of the bank's staff.

Steve Tatlow, LTU assistant general secretary, said that it was "an important case" and could force Lloyds to drop its offshoring policy for fear of losing customers.

"Concerns over data protection are yet another reason why Lloyds TSB should now listen to its customers and commit itself to the UK," he said.

"We are pressing Lloyds TSB to stop turning a deaf ear to its customers and to put customer satisfaction and concerns over data security at the centre of its strategy rather than being seduced by the opportunity to cut costs.

"More than 90 per cent of the customers we approach outside branches are wholly opposed to their bank accounts being managed from abroad.

"If the bank continues to ignore customer wishes then even greater numbers are likely to switch theiraccounts to those other banks who are committed to the UK."

A Lloyds TSB spokesman said: "We are confident that we comply with the Data Protection Act and our customers can be reassured that their personal information is as protected in India as it would be in the UK."

But experts say if the case is successful it could set a legal precedent, triggering a complete re-think about off-shoring across the industry.

Hampshire employees of HSBC and Abbey banks have already endured scares their jobs might be switched abroad to be filled by cut-price Indian workers.

Eamonn Rice, head of financial services at accountants Ernst & Young, believes that a major regulatory crisis at a bank or financial services firm will prompt a major rethink on offshoring.

He said: "Given the volume of offshoring that is going on and the risks attached, there will have been a major regulatory failing within five years.

"Financial services companies can never be sure that offshore workers are up to speed on UK regulatory requirements."