Privacy Legislation UPDATES
By Donna Loyle
In the current two-year legislative season, about 1,500 privacy-related bills at both the state and federal levels have been introduced, according to The Direct Marketing Association (DMA). Following are three examples that affect direct marketers:
Online Privacy Bill Proposed
The Online Personal Privacy Act of 2002, introduced by Sen. Ernest "Fritz" Hollings (D-SC) in April, would mandate that companies get consumers' opt-in permission to use sensitive data, such as financial records, Social Security numbers and health information. The bill also requires companies to provide opt-out options for non-sensitive data such as transactional information from Internet purchases.
The bill passed the Senate Commerce Committee in May by a vote of 15-8, and at press time was moving toward a vote by the full Senate. In a prepared statement, The DMA expressed its opposition: "This legislation fails to take into account that industry self-regulation of data privacy protocols have reached more than 90 percent of all Internet traffic, which renders the proposed bill's aims premature."
Anti-spam Bill Proposed
The Senate Commerce Committee also unanimously passed in May a bill that would allow the Federal Trade Commission (FTC) to impose fines on companies that violate existing spam laws. The proposed bill, which was headed to a full Senate vote at press time, would enable the FTC to charge fines of up to $1.5 million, according to reports. The so-called "Can Spam Act," if passed, also would require that all unsolicited e-mails contain valid and working return addresses that recipients can use to opt-out of future e-mails from the senders.
Sen. Conrad Burns (R-MT), one of the bill's sponsors, told reporters the bill empowers consumers with "the choice to close their doors to hyper-marketing once and for all." The Burns bill would exempt e-mail marketers who can show they have pre-existing relationships with recipients. This includes any transaction initiated by the consumer within the past three years.
New Mexico's Opt-in Provision
Marketers at banks, financial services firms, insurance companies and securities firms doing business in New Mexico: You now must get opt-in permission to market your services to residents of that state.
The new regulation, which went into effect earlier this year, makes New Mexico the first state to adopt an opt-in provision for the release of nonpublic personal financial information among unaffiliated financial services and insurers, according to reports.
The new state law is stricter than Gramm-Leach-Bliley, the federal law that took effect last year. The New Mexico law doesn't restrict the exchange of ordinary financial information, such as claims processing. Rather, it mandates that personal financial information can't be disclosed to third-parties unless consumers grant explicit permission.