What’s happening with privacy bill?
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TODAY WAS supposed to bring a key vote on Senate Bill 1, the latest attempt to give consumers control of their personal financial information. But the hearing in the Assembly Banking and Finance Committee has been postponed, most likely until June 9. The reason? SB1 would almost certainly be rejected in its present form. The committee was stacked by Speaker Herb Wesson with members who have voted against — or intentionally skipped votes on — similar privacy bills in the past. As the legislation twists and turns, financial-industry cash continues to pour into Sacramento. The industry spent more than $20 million last year on campaign contributions and lobbying expenses, a staggering sum for a Capitol of 120 legislators and one governor. The great hope for action this year rests with the threat of a March 2004 ballot initiative that would require banks, insurance companies and stock brokerages to get customer permission before selling or sharing personal financial information they compile from applications, purchases, investments and even Web site visits. Let there be no doubt: Passage of an initiative would be a damning indictment of the failure of this Legislature — and Gov. Gray Davis — to deliver a basic consumer protection that polls show is desired by an overwhelming number of Californians. Behind the scenes, the author of SB1, Sen. Jackie Speier, D-Hillsborough, has been working with Assemblyman John Dutra, a Fremont Democrat who is influential among business-friendly legislators, to try to fashion a compromise. Dutra, trying to balance individual privacy rights against the industry’s demands for flexibility, said the negotiations have been “very tough,” but he remains optimistic. “My interest is in trying to get a good, strong privacy bill out of the Legislature . . . frankly, a bill that would make the initiative unnecessary,” Dutra said. In our view, legislative action would be preferable to an initiative. It would produce the privacy protections sooner, and it could be amended more easily if unanticipated problems arise with the new law. But SB1 must not lose any of these basic principles, each of which was intact when passed by senators in March: – Customers should get a clear notice of how a financial-services company plans to use their personal information. – The burden should be on the company to obtain a customer’s permission before selling information to telemarketers and other third parties. And the customer should have a chance to stop a company from sharing confidential information with its affiliates. – Companies that break the law should be subject to tough penalties. If legislators once again fail to produce a bill, or if they pass a weak version ridden with loopholes, then voters should be ready to take action themselves to regain control of their personal financial information. |