House Poised to Steal State Privacy Rights Under The Cover of 9/11

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The exchange of social security numbers and other financial identifiers among America’s corporations dramatically increased Americans’ risk of identity theft

WASHINGTON D.C. — While the nation was focusing on the second anniversary of one of its worst tragedies, the House of Representatives was poised to quietly support a bill today that will void California’s new landmark financial privacy law and prevent any other state from passing comprehensive consumer privacy protections.

The California-based consumer advocacy group, the Foundation for Taxpayer and Consumer Rights (FTCR) sent a letter to House Speaker Dennis Hastert on Monday asking him to reschedule today’s vote in order to ensure “a fair hearing during a week when the nation is not preoccupied with the greatest national tragedy of the last century.”

“Republicans support states’ rights except when it offends their campaign contributors,” said Jerry Flanagan of FTCR. “This legislation is an insult to Californians who have overwhelming supported stronger, not weaker, financial privacy legislation. Now, it is up to the Senate to protect a state’s right to shield consumers put at risk by banks who sell our private information for their own profit.”

In the 2002 election cycle, big banks contributed $20.6 million dollars to Congressional representatives — 63% to Republicans. Since 2000, President Bush has received $2.1 million in from securities and investment firms, $582,250 from commercial banks, $562,292 from insurance companies and another $967,100 from other finance companies.

“What the banks and the GOP really want is the ability to commit uniform privacy violations, and not states’ rights to protect consumers,” said Flanagan. “Without limits on affiliate sharing, a Pandora’s box is opened because thousands of companies will have access to citizens’ private information.”

California’s new privacy law, signed by Governor Gray Davis on August 27, 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corporate affiliates not in the same line of business, such as between banks and insurers — that protection would be superceded by HR 2622. Flanagan 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.

President Bush promised in his 2000 campaign to make it a criminal offense to sell a person’s social security number without his or her permission, but has yet to deliver. [Associated Press, October 29, 2000, “Q&A: Gore and Bush on Education, Trade and Other Issues] Bush also said: “I think there ought to be laws that say a company cannot use my information without my permission. We can live in a private world” [ZDNN – Q&A with George W. Bush, ZDNet News, Jun. 21, 2000].

“The showdown will be in the Senate and the White House, where politicians won’t have the shadow of 9/11 to hide their tracks. Ultimately, America’s privacy may depend on whether President Bush is forced to live up to his campaign promises,” said FTCR executive director Jamie Court, author of Corporateering: How Corporate Power Steals Yours Personal Freedoms And What You Can Do About It (Tarcher/Putnam). “The status quo that the GOP and banks want to protect is clearly not good enough when I can buy the Social Security number of CIA director George Tenet on the Internet for as little as $26.”

To demonstrate how almost everyone’s private information is at risk without stronger state laws, Court purchased the social security numbers and home addresses of key cabinet officials and members of Congress over the Internet for as little as $26. These include the Social Security numbers of John Ashcroft, CIA Director George Tenet, Labor Secretary Elaine Chao, and FTC Commissioner Timothy Muris, House Speaker Hastert, and Senators Shelby and Sarbanes. President Bush‘s information was not for sale, Court said, because he is too famous.

“The people of California have spoken and the nation should have the chance to agree: we deserve the right to tell a financial institution “no” when they share our private personal information with their affiliates. Holding a hearing for HR 2622 on close to the day of national mourning will deny the public the right to understand what is at stake and give the banks and insurers that seek to take Americans’ privacy a quiet victory,” wrote Flanagan in a letter to Speaker Hastert.

The exchange of social security numbers and other financial identifiers among America’s corporations has dramatically increased Americans’ risk of identity theft. Identity theft led all complaints to the Federal Trade Commission in 2000, 2001, and 2002, and doubled in 2002.


The Foundation for Taxpayer and Consumer Rights is a California based non-profit and non-partisan consumer watchdog organization. For more information visit us on the web at http://www.consumerwatchdog or

Consumer Watchdog
Consumer Watchdog
Providing an effective voice for American consumers in an era when special interests dominate public discourse, government and politics. Non-partisan.

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