Academic journal article ABA Banking Journal

Bank Associations Attack Feds' Claims That Banks Lack Privacy Rules

Academic journal article ABA Banking Journal

Bank Associations Attack Feds' Claims That Banks Lack Privacy Rules

Article excerpt

Neither event was unique, but both were troubling. First in a June speech at a privacy forum, Commerce Secretary William M. Daley expressed his frustration that many U.S. industries doing electronic commerce haven' moved forward with efforts to provide for self-regulation o privacy issues.

"Some prefer no regulation, over self-regulation, until they are truly convinced there will be government regulation," said Daley.

"There are people who think industry has been dancing around, avoiding the real issues, buying time-and that government should step up to the plate," Daley continued. "I sincerely hope industry steps up to the plate first."

Even more sobering was mid-July congressional testimony by Federal Trade Commission Chairman Robert Pitofsky.: "The commission believes that, unless industry can demonstrate that it has developed and implemented broadbased and effective self-regulatory programs by the end of this year, additional governmental authority in this area would be appropriate and necessary" (emphasis added). In the same hearing, Pitofsky set out a model Congress could use.

These warnings follow comments made by Federal Trade Commission officials in the wake of its study of privacy issues on banking and other sites on the World Wide Web (Briefing, July, p.9). Most such commentary, as well as legislative activity, when directed towards banking, arises from the premise that financial services companies are substantially free from privacy restrictions.

Objecting to that characterization. …

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