Magazine article American Banker

House May Pass A Bare-Bones Data Security Bill

Magazine article American Banker

House May Pass A Bare-Bones Data Security Bill

Article excerpt

WASHINGTON -- Lawmakers aim to speed data security legislation through the House this week by stripping it down and leaving the details to the Senate.

But whether they move just a narrow bill based on one the House Financial Services Committee approved March 16, or move it along with a limited House Energy and Commerce bill, which was approved March 29, remained unclear Friday.

"There are lots of ways this could be worked out," said Floyd Stoner, the head lobbyist for the American Bankers Association. "I think there is a desire on the part of everyone to get this done before August if possible." Nevertheless, "I'm not -- at this point -- ready to handicap anything, because there are a lot of creative people, and the thing that I notice about the Congress is people get more creative when there is a gun to their head."

That gun is the congressional calendar. Lawmakers plan to work this week, recess for the month of August, and adjourn for the year in early fall.

To narrow the Financial Services Committee's bill, House leaders are contemplating imposing data safeguards and breach notification requirements only on financial institutions.

That concept left many financial services lobbyists bewildered, mainly because the Gramm-Leach-Bliley Act already imposes these requirements. The idea behind the legislation was to force a wider range of companies to protect their customers' privacy.

"We've all been scratching our heads," said an industry source, who did not want to be identified.

But the narrowing tactic could end up satisfying the industry's other big objective: creating a uniform data privacy standard that would override 32 state laws.

"We have been supporting a strong national preemption standard and hope that we will see that as part of the final bill," said Darlene Papier, a lobbyist for the Consumer Bankers Association. …

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