Saving the privacy law

A CRITICAL CONSUMER privacy bill by state senator Jackie Speier has been watered down so badly that it won't be nearly as effective as it should be. Worse, Speier has amended the bill so that it would preempt more stringent laws in cities and counties – overturning San Francisco's privacy law. Everyone who's worried about banks, insurance companies, and telemarketers sharing personal financial information ought to be on the phone to Speier urging her to tighten up the bill and remove the local preemption clause before it goes to a key committee next week.

Speier's bill addresses a growing problem: giant financial services conglomerates routinely share what ought to be private information among affiliates and subsidiaries. Details about your bank balance and loans can be used to try to sell you insurance; your credit card spending patterns can be analyzed and turned into weapons for telemarketers.

Three times in the past three years, the senator, who represents parts of San Francisco and San Mateo counties, has introduced strong legislation that would have required consumers to give written permission before financial institutions could share and market their private records. But Gov. Gray Davis has vetoed every effort.

Last week Speier and Davis announced a compromise: Speier took out some of the most significant provisions of the bill, and Davis agreed to back it. Among the key provisions she removed: a requirement that consumers agree in writing to allow their information to be shared. After consumer groups raised a furor, she promised to put that language back in.

But the new bill still allows banks to share some information with their affiliates without consumer permission, and it allows corporations (and telemarketers) to offer discounts to induce customers to allow their financial records to be shared. And it specifically prevents local governments from passing tougher laws.

In effect, the Speier bill would repeal San Francisco's Financial Information and Privacy Ordinance, which requires local financial institutions doing business with local residents to meet fairly high privacy standards.

The San Francisco Board of Supervisors should direct the city lobbyist to strongly oppose that provision. And consumers should let Speier know that her bill ought to meet or exceed local standards, instead of lowering them.

Equally important, Davis (who is in serious political trouble right now) needs to hear that voters in a Democratic stronghold like the Bay Area are very unhappy with his moves to force Speier to gut her privacy bill. The bill, SB 1, is likely to be heard in the Banking and Finance Committee June 19, so there's still time to turn this around.

Contact Speier at (916) 445-0503 or senator.speier@senate.ca.gov; contact Davis at (916) 445-2841 or governor@governor.ca.gov.