Banks Curtail Information Trafficking
June 14, 1999
Several large banks have revised their policies on sharing information with telemarketers. Also, Congress is looking into the sharing of customer data as voters voice concerns over keeping personal information private.
- Bank of America Corp. has just announced that it will no longer share customer information -- including addresses, telephone numbers and credit card account numbers -- with outside vendors such as telemarketers, but will act as a middleman for vendors of financial products.
- U.S. Bancorp. announced last week that it is ending its relationship with several telemarketing companies that solicit its customers to buy a variety of nonfinancial products, following a suit filed against it by the Minnesota attorney general..
- Federal and state regulators are reportedly cracking down on abuses tied to information trafficking.
- Last week, the House Commerce Committee approved a rider to financial services reform legislation that would give consumers the right to prevent banks from sharing financial information with their own insurance and securities affiliates.
Banks frequently provide birth dates, Social Security numbers, checking and credit card information, addresses and telephone numbers to outside companies for hefty fees or commissions.
But there have been growing numbers of consumer complaints recently about telemarketer practices that include charging a customer's credit card and withdrawing money from checking accounts when consumers believe they have not given permission to do so.
Source: Timothy L. O'Brien, "Big Bank Says It Won't Share Customer Data," New York Times, June 12, 1999.
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