Federal lawmakers need to step forward and define a national standard for regulating open records. State-by-state legislation would create a complex patchwork of potentially conflicting regulations resulting in both increased costs and consumer jeopardy. Like interstate commerce, open record legislation should be governed by a single national law.
Recently, two senators (Senators Patrick Leahy, D-Vermont. and Arlen Specter, R-Pennsylvania) introduced a bill mandating that businesses establish data-security management plans and as well setting a nationwide standard for notifying consumers of observed security breaches.
Under their bill, any company that stores information about more than 10,000 people must create a program to protect data privacy. The bill would give consumers the right to review and correct information collected by information brokers such as ChoicePoint. With certain exceptions, the bill prohibits the display, sale, and purchase of social security numbers without an individualís consent.
But, there are exceptions in the bill. While a data broker would be prohibited from selling social security numbers without the consent of the consumer, the numbers could be sold for ďresearchĒ purposes, or if only the last four digits are listed. These exceptions have the effect, in practice, of nullifying some of the good parts of the bill. NALTEA members may want to join together to work for the refinement of this legislation.
Another concept gaining traction is the proposed universal application of the fraud alert. This would benefit consumers who have become victims of identity theft. Consumers who suffered from identity theft would be allowed to add the record of that theft to their credit reports for a period of seven years, serving notice to credit grantors that they need to look beyond the credit report for a true evaluation of the consumerís credit standing. Before any new credit would be granted under the consumerís name, the lender or credit card issuer would be required to contact the consumer to verify that they, rather than an imposter, applied for credit.
Lastly, there are proposals circulating that would allow an individual to refuse to provide their social security number to a business unless that business can demonstrate a security management plan or encryption of financial records.
Thatís just the tip of the legislative iceberg when it comes to privacy. I would still like to hear from other members of NALTEA on these and any other privacy-related issues facing the title industry that you think we should study. Please send your comments and thoughts to me at email@example.com.