www.privacyrightsnow.com
Consumer Federation of America * Electronic
Privacy Information Center
Privacy Rights Clearinghouse * Public Citizen Litigation Group
Ralph Nader * Remar Sutton * U.S.
PIRG
For Immediate
Release: 21 June 2001
Contact: Remar Sutton 404-229-5094
Jake Lewis (Ralph Nader’s office) 202-387-8030
Ed Mierzwinski, USPIRG, 202-546-9707
Marc Rotenberg (EPIC) 202-483-1140
Travis Plunkett, CFA 202-386-6121
David Vladeck, Public Citizen, 202-588-1000
Beth Givens, Privacy Rights Clearinghouse 619-298-3396
--New Opt-Out Website And Formal
Petition To Regulators Announced –
-- Groups Urge
Stronger Privacy Laws To Replace Weak, Confusing Notices--
WASHINGTON, DC -- As a July 1 privacy notice deadline looms, the nation’s leading consumer and privacy advocates today exposed the strategy of the nation’s banks and other financial institutions to send consumers billions of “deceptive” privacy notices required by a “defective” new financial privacy law, while the banks’ lobbyists oppose stronger privacy laws in state capitols and Congress.
The groups launched a website, “privacyrightsnow.com,” to teach consumers how to “Say No” to banks selling their confidential records to telemarketers and also urged consumers to “fight back” by demanding stronger privacy laws based on consent, because “Notice is not enough.” The groups also announced a planned petition to regulators to improve compliance with the law.
“In Congress, there is strong bi-partisan support for real opt-in privacy protection, said Ralph Nader. “Strong privacy protection would pass if the leadership of both Houses would let a clean bill come to the floor for a straight up or down vote in this Congress.”
“Banks have made “saying no” confusing and cumbersome,” said consumer advocate Remar Sutton. “Our coalition’s new website “privacyrightsnow.com” shows consumers how to say no or “opt-out” easily and our sample opt-out letter puts the burden on companies to follow their customers' privacy requests, rather than leaving the burden on consumers to understand and follow the companies’ deliberately confusing messages.”
"It
is time for Congress to act to safeguard the privacy rights of American
consumers. Too many companies have too much data about our private lives,"
said Marc Rotenberg, executive director of the Electonic Privacy Information
Center.
“The notices are unintelligible and purposely deceptive,” said Ed Mierzwinski of U.S. PIRG, “But the law itself is defective, since it gives banks rights to sell information as long as they give consumers notice, but notice is not enough. That’s not surprising, however, since the bank lobbyists are everywhere in Congress and every state Capitol trying to dumb-down efforts to pass real privacy protections.”
The 1999
Gramm-Leach-Bliley Financial Services Modernization Act requires any bank or
other financial institution that shares or sells confidential consumer account
information with either affiliates or third parties to send consumers a notice
of their sharing and selling practices by July 1, or lose the right to continue
to share and sell. The law gives customers a limited right to say no (opt-out)
to sharing or selling with some, but not all, third parties. Even if a consumer
says no, banks can still share health and financial information with affiliates
and most third parties. The new federal law allows states to pass stronger
financial privacy laws. For example, a financial privacy opt-in proposal (SB
773, Speier) has passed the California Senate, but faces an uphill battle in
the Assembly.
"Congress must give
consumers real privacy protection," said David Vladeck, Director of Public
Citizen Litigation Group. "Until then, the federal regulatory agencies
must implement the law in a way that gives consumers an opportunity to prevent
financial institutions from selling their private personal information to the
highest bidder, so our attorneys are drafting a formal petition to compel the
regulators to use existing authority to strengthen the rules."
“Studies
by our readability consultant of 34 different privacy notices found they
required an average of between 3 and 4 years of college education to
understand,” said Beth Givens, Director of the Privacy Rights Clearinghouse.
“If these privacy notices were insurance policies, all of them would have
failed readability requirements in every state that requires plain English for
insurance policies.”
The
groups support stronger laws based on Fair Information Practices (e.g., limited
information collection, right to review and correct records, consent (opt-in)
before sale or secondary use) and intend to work with the bi-partisan
Congressional Privacy Caucus chaired by Reps. Markey (D-MA) and Barton (R-TX)
and Sens. Shelby (R-AL) and Dodd (D-CT) to pass strong privacy laws that
protect consumers in financial and all circumstances.
“Unfortunately,
financial services companies are the big winners under this new law and consumers
are losers,” said Travis Plunkett, Consumer Federation of America legislative
director. “Consumers lose the right to
real choice. They lose control of highly sensitive information. And they could lose their savings, when scam
artists exploit access to this information to deceive and defraud them.”
“Until
Congress enacts the strong privacy laws consumers are demanding, the epidemic
of identity theft, financial rip-offs and other problems caused by unfettered
corporate access to the bits and pieces of our personal lives will only get
worse,” concluded Nader.
The groups urged
consumers to do two things: First, opt-out by visiting privacyrightsnow.com and
second, fight back by urging Congress and state legislatures to pass real
opt-in privacy laws.
-30-
Remar Sutton, organizer of this press conference, is
President and co-founder with Ralph Nader of the Consumer Task Force For
Automotive Issues, and coordinator of the new www.privacyrightsnow.com opt-out website.
The Consumer Federation of America (www.consumerfed.org) is a coalition of
285 national, state and local organizations with a combined membership of over
50 million people.
The Electronic Privacy Information Center (EPIC) (www.epic.org) is a public interest research
center in Washington, D.C. It was established in 1994 to focus public attention
on emerging civil liberties issues and to protect privacy, the First Amendment,
and constitutional values. EPIC also maintains the central website www.privacy.org for news and action and
coordinates the activities of the Privacy Coalition (www.privacypledge.org), an
organization of privacy, consumer, family, conservative and civil liberties
groups working together for strong privacy laws.
Public Citizen Litigation Group is part of Public
Citizen, (www.citizen.org) the citizen
advocacy organization founded by Ralph Nader in 1971.
The Privacy Rights Clearinghouse (www.privacyrights.org) is a nonprofit
consumer education, research, and advocacy program. Its publications empower
consumers to take action to control their personal information by providing
practical tips on privacy protection.
U.S. PIRG (www.pirg.org/consumer) is the national association of state Public Interest Research Groups. PIRGs are non-profit, non-partisan consumer, good government and environmental advocacy organizations.