@Jason, that is a very good point. Under the UK data protection act an individual can ask that their records be removed in certain conditions. Imagine having to remove individual records from backup tapes you may still need!
I asked our legal counsel about that issue. Such as the person that opened and closed the account within a year and should have "technically" been purged in 2009 but was still in the mass of data from 2010.
The legal view, written down to cover my butt, was that in the mass of data it was not an issue. But if that data were to be subpoenaed it technically did not exist beyond a certain date in the sense it could not be revealed or provided to the courts or any of the litigants.
Most courts understand that this is how it works. Now if the data was to be subpoenaed by the courts before the purge period, you have a responsibility to retain it until the courts no longer need it regardless of the purge dates.
A little bit of this and a little byte of that can cause bloatware.