The Information Commissioner, which enforces the Data Protection Act, received the complaint from consumer group Scamsdirect that NatWest failed to dispose of customer information securely.

Scansdirect says it found confidential customer information in a rubbish bin outside a RBS/NatWest branch in Fareham, Hampshire. The items are thought to have included plastic cards that had been cut into pieces as well as money deposit details and bank account information.

The consumer group says the confidential data found could be used by criminals to commit identity fraud.

RBS says the bags removed by Scamsdirect were general waste bags taken from its dustbins outside the branches. The bank says it is investigating the incident along with other claims by Scamsdirect that small amounts of confidential material were found within general waste at other branches.

RBS faces a penalty if the Information Commissioner finds there have been any breaches and decides to press charges against the bank. The watchdog says depending on the outcome of its investigation, it will consider using formal enforcement powers "to prevent incidents like this happening again in the future".

Figures from the UK's National Consumer Council (NCC) show that ID theft is estimated to cost the UK economy £1.7 billion and affects more than 100,000 people every year.