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 Maligned California Displays Leadership With Privacy Law
by Broderick Perkins
The same law that gives Californians the right to turn their state into a political circus, was used to leverage what could become the nation's toughest privacy law -- perhaps restoring some of the Golden State's tarnished image as a legislative leader. The new privacy law legislators likely will pass and Gov. Gray Davis has promised to sign isn't what consumer advocates hoped for when they threatened to use the initiative process to take the measure straight to voters. But Sen. Jackie Speier's (D-San Mateo) SB-1, the "California Financial Information Privacy Act" will be tougher than federal privacy law even after compromises which forced the financial industry lobbyists to back off opposition to the measure. "This bill maintains the same strong framework for protecting consumers' financial privacy that we've advocated all along," said Betsy Imholz, Director of Consumers Union's West Coast Regional Office. "With some very minor changes, this is essentially the same proposal we urged state lawmakers to enact earlier this year," she added. If signed, the new law's toughest provision would force financial institutions to ask a consumer to "opt in" -- or give the institution permission -- to share consumer's private information with third parties. Federal law says virtually the opposite -- consumers have the right to "opt out" -- or ask financial institutions not to share information with third parties, sometimes after they have already begun to do so. Similar to federal law, California's new law would also say: A recent federal court ruling questioning states' rights to interfere with financial institutions sharing information with affiliates could put the California legislation in conflict with federal law, but that's not likely to stop passage. Consumer advocates are holding over the heads of legislators and the financial industry 600,000 signatures they have collected to qualify the measure for an initiative on the March 2004 ballot. If the legislature fails to pass Sen. Speier's bill before initiative petitions are due to the Secretary of State's office on August 20, Californians for Privacy Now will take the issue directly to the voters. Californians for Privacy Now is a coalition of organizations, including AARP, CalPIRG, Consumer Federation of California, Consumers Union, E-LOAN, Privacy Rights Clearinghouse, and American Civil Liberties Union. The same initiative process (the right to pass legislation by ballot vote) consumer advocates used to threaten legislators and the financial industry is part of the same law Californian's used to place a voters' recall of Gov. Davis on an upcoming ballot that has the nation tittering. More than 100 candidates, including Arnold Schwarzenegger, Larry Flynt and Hollywood has-beens Gary Coleman (Diff'rent Strokes), Don Novello ("Father Guido Sarducci"), and "Sledge-o-Matic" comedian Gallagher, are vying to replace the governor. The public's right to recall a politician in California, as well as the right to pass legislation by ballot vote, was inserted into the state constitution 100 years ago. The legislative tool, in part, has helped make California a legislative leader. Powerful laws appear in California often before they spread to other states or become federal legislation. "As we've said all along, we believe that the legislative process is the most constructive way to get laws passed," said Beth Givens, director of Privacy Rights Clearinghouse. "However, if the legislature fails to do the right thing we'll be compelled to take our ballot measure directly to the voters so that they can settle this issue once and for call," she vowed. Published: August 21, 2003 Use of this article without permission is a violation of federal copyright laws.
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30 Year Fixed: 3.83% 15 Year Fixed: 3.05% 1 Year Adj: 2.73% (U.S. Weekly Averages) Today's Headlines 08/21/2003
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A journalist for 35-years, Broderick Perkins parlayed an old-school daily newspaper career into a digital news service offering editorial content and consulting services. Perkins' San Jose, CA-based DeadlineNews Group includes the flagship news site,