Long-Stalled Privacy Bill Passes Out of California Assembly

Privacy issues are not necessarily in the jurisdiction of this blog, but they cannot be ignored entirely given that they were Item #4 on Insurance Commissioner Garamendi’s priority list, issued as part of his inaugural address. (That speech was previously mentioned here.)

The principal piece of privacy legislation in Sacramento has been Senate Bill 1. That bill is directed at limiting the extent to which financial institutions -- including insurers -- can use or share personal information about their customers without those customers’ consent. The bill passed the state Senate last March, but had been languishing in committee in the Assembly until yesterday, when it suddenly began moving quickly, passing out of the Assembly by a vote of 76-1. The Sacramento Bee reports the story here and summarizes the general effect of the bill:

Current law allows financial institutions to share their customers' personal information with affiliates or other companies with few restrictions.

The legislation on its way to the state Senate would allow consumers to deny the right of the company to share their information with branches of the same firm. In addition, consumers would have to give their approval before a company could share their information with outside companies

The current text of the bill can be found here, and complete history can be found here.

The current recall election in California is also somewhat beyond our usual topics here, but the current debate over California’s vigorous approach to participatory democracy is also relevant to the passage of SB1. As Bee columnist Daniel Weintraub reports, it is unlikely the bill would ever have escaped from committee but for the threat of an initiative campaign and the pressure that Governor Davis feels to act “gubernatorial.” (Weintraub’s site, California Insider, is an invaluable aid for keeping track of recall developments, if you are interested in following them.)