Magazine article American Banker

Headaches for Banks Seen in European Privacy Plan

Magazine article American Banker

Headaches for Banks Seen in European Privacy Plan

Article excerpt

PHOENIX -- Banks that do business with European citizens and companies could face a big regulatory headache if a European Community proposal for protecting personal privacy is accepted as law, a policy expert warned at a conference.

The proposal, which could be voted on for acceptance as law this year, calls for broad new limits on the use and dissemination of information about citizens and companies in the 12-nation European Community.

While the proposal doesn't single out banks, it could have a big impact on them, because they rely so heavily on computerized data banks of information, said Jill A. Oliver, a privacy policy expert and associate with J.P. Morgan in New York.

Speaks at ABA Conference

"Banking is concerned because we feel the proposal is going to impose excessively bureaucratic, costly. and time consuming restrictions on the collection, use, alteration, or transfer of personal data files of EC citizens," Ms. Oliver said in a presentation at the American Bankers Association's National Security and Risk Management Conference here.

The proposal by the European Commission, the agency that helps set rules for the Common Market, attempts to give every citizen in the Community some protection from the escalating intrusion of computerized data bases on personal privacy.

Requires Subject's Consent

For example, the proposal says that any time a data file on a Community citizen or company is created or altered, the subject of the file must be informed, and his or her consent given, especially if the information is to be used for marketing. …

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