A California consumer advocate will expose how President Bush was reneging on campaign pledges by quietly backing federal legislation to override new state privacy laws. California enacted such a privacy law, to be signed by Governor Gray Davis on Wednesday, that allows consumers to stop the broad trade of private financial information between corporations and their affiliates.
“President Bush will have to choose between the commercial freedoms of corporations and the privacy rights of Americans,” said Jamie Court, author of “Corporateering: How Corporate Power Steals Yours Personal Freedoms And What You Can Do About It” (Tarcher/Putnam). “Banks and insurers should not be able to go to Washington as an end-run around the most protective state privacy laws. The President should realize his campaign pledges to protect Americans' privacy are needed more than ever when I can buy the social security number of “CIA” director George Tenet on the Internet for as little as $26.”
Court, the executive director of the Santa Monica-based Foundation for Taxpayer and Consumer Rights (FTCR), pointed to the Administration's support this summer for ongoing federal preemption of new state privacy laws under the Fair Credit Reporting Act, a clause due to expire January 1.
That policy, promoted by banks and insurers, is embodied in HR 2622 — which prevents states from having the authority to stop banks and insurers from trafficking in individuals' private information with their many affiliates. The hardly-noticed legislation passed out of the House Financial Services Committee in late July and will be on a fast track after Labor Day.
California's new privacy law allows consumers to prevent the trade in their private financial information among corporate affiliates not in the same line of business, such as between banks and insurers. That protection would be superceded by HR 2622. Court said limiting affiliates' access to private information is critical to protecting Americans' privacy because large corporations today broadly affiliate. Citigroup, for example, has 1700 affiliates who, under current federal law, cannot be stopped from trading individuals' private information, even when a consumer explicitly says no. [Privacy Digest]