The Great Congressional Sell Out – Your Identity for Their Campaign Contributions

March 16, 2006 – You can call it anything you want but when the average American accepts money or gifts in return for favorable treatment, it’s referred to as a “bribe”. And when they accept bribes in the course of their jobs, it’s a criminal matter that can result in stiff fines and jail time. But in Congress, this kind of behavior is referred to as “lobbying” rather than “corruption” and it is all in a day’s work. And thanks to the lobbying efforts of banks and data brokers, Congress is now poised to strip away laws that the states use to help you from becoming an identity theft statistic. They should be ashamed.

 

In early 2005, California was the only state with a data breach notification law. This law required companies that store consumer data to notify California consumers when that data was exposed without authorization. The goal of the law was to insure that consumers could take protective measures to prevent identity theft.

 

In February, 2005 ChoicePoint, one of the largest data brokers in the country, had a large data breach involving 30,000 California consumers. The breach exposed all of those consumers to potential identity theft and the law forced ChiocePoint to notify California consumers of the breach.

 

But ChiocePoint stubbornly denied that any consumers outside of California had been exposed. That denial turned out to be a lie, and within a week the company was forced to admit that 145,000 consumers in every state had been exposed. At the time, it was the largest known data breach in American corporate history. That record didn’t stand for long however.

 

Within a few months Lexis-Nexis, another large data broker, had a similar breach. This time the data of 310,000 consumers were involved. Once again, California’s law required disclosure to citizens of the state, but Lexis-Nexis decided to avoid the mistakes of ChoicePoint and notified consumers around the country.

 

Based largely on these two breaches and the effect of California’s law, 22 states have passed similar laws in the past 12 months. These laws have forced companies to notify consumers of more than 100 data breaches within that time. This means that there is actually a significant breach of consumer data about once every three days.

 

While these notification laws are popular with consumers and the states, they are very unpopular with the companies that are supposed to be guarding your data. So they have been lobbying Congress to pass a weak national standard to regulate data breaches and consumer notifications. And that effort may be about to pay off at the expense of consumers.

 

The House Financial Services Committee is about to act on HR 3997, a bill which is widely referred to as the "worst data breach notice bill ever." Among other things, the bill provides a notification standard for data breaches that is so weak that it is expected there will be no consumer notifications in the future. The bill also prevents the states or their attorneys general from passing stronger financial privacy laws, or enforcing laws that are already on the books.

 

In short, the bill is a complete sell out of American citizens by a small group of corrupt politicians that are more concerned with campaign contributions that they are with the well being of their constituents.

 

It should be no surprise that this bill is moving forward at precisely the same time that many members of Congress are trying to stop lobbying reform legislation in its tracks. Congressional members are openly complaining about legislation that would prevent them from taking free corporate sponsored trips. They are also campaigning about legislation that would force members to declare “earmarks”. These are federal funds that are steered to “special projects”, normally at the behest of lobbyists and without any debate on the floor of Congress.

 

If you are interested in voicing your displeasure with HR 3997, Consumers Union has setup a website that will allow you to send a letter to your elected representatives. Just go to www.financialprivacynow.org, fill out the contact information and hit the “submit” button. A letter will be sent to representatives asking them to vote “no” on the bill.

 

by Jim Malmberg

 

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