The financial services sector has had a respectable track record in the protection of consumer privacy. However, business practices, industry consolidation, electronic commerce and economic trends have raised consumer privacy as a key issue in the financial services sector. Improvements in the rapid transfer of information provide a new medium for the purchase of goods and services, that is, the medium of electronic commerce. The European Union has forced the issue with the Data Protection Directive. As a result, the United States has had to debate the lack of regulation or standards governing the new medium of electronic commerce. The debate could hinder any advance by society to engage in new technology. Because of increased government attention through regulatory and legislative action, corporations are developing self-regulatory initiatives to create industry standards for electronic commerce. Consumer privacy deals with how and what types of information are collected and how the data is controlled and accessed. Consumer concepts of privacy will resist or allow different configurations of what is allowable and what is utilized. The book is an exploratory and descriptive study that assesses the privacy concerns of today's consumer, as well as determines the potential impact of consumer privacy concerns on technological innovation and public policy. In order to understand privacy concerns, the study builds and extends current quantitative research on privacy in the financial service sector. Current research was developed to assess the privacy concerns of consumers. It was not designed to analyze or evaluate the specific impact of privacy on underrepresented consumers. The study expands research to focus on this particular segment of the population. Using privacy as the foundational issue/motivation for developing perspectives on financial education, the study focuses on people of color in the financial mainstream of our economy.

In this updated edition, author Nicola Jentzsch provides an in-depth analysis of the economics and regulation of financial privacy. You get a comparative overview of credit reporting systems in the US and in the 27 member states of the European Union. This is the "most in-depth study of the history and economics of credit reporting to date," according to David Medine, former Associate Director of the U.S. Federal Trade Commission.

The financial privacy law passed by Congress in 1999 has been the target of scathing criticism. Financial institutions have complained about the high costs of the billions of notices sent to consumers, apparently to widespread consumer indifference. On the other side, privacy advocates have condemned the law as woefully weak. This article disagrees with the criticisms. Part I describes the main provisions of Title V of the Gramm-Leach-Bliley Act, showing a better match with basic privacy principles than many have realized. Part II explores the history of how GLB became law, placing the enactment into the context of a historic peak of privacy policy activity in the late 1990s. This history draws on my dual perspective, as an academic who has written extensively about financial and other privacy issues, and as the Clinton Administration's Chief Counselor for Privacy during the period. Part III looks at the most hotly contested issue in the privacy debate, the rules for sharing personal information with affiliated entities and third parties. GLB establishes a basic rule that information can flow freely within a financial institution and to its affiliates. Customer choice - an opt out ability to prevent sharing - applies for transfers to non-affiliated companies. The article argues that an exception to that principle of customer choice, the "joint marketing exception" should be repealed. It then explores the knotty issue of how to handle data sharing in today's vast financial conglomerates, suggesting possible statutory modifications. Part IV looks at the much-maligned notices that financial institutions have sent out in compliance with GLB. The critics have accurately complained about the legalistic and detailed language in the current notices. The critics have largely overlooked, however, important benefits from these notices. Publication of the notices and the new legal obligation to comply with them have forced financial institutions to engage in considerable self-scrutiny of their data handling practices. Many firms have hired a Chief Privacy Officer or made other institutional changes. The current notices, even in their imperfect form, have reduced the risk of egregious privacy practices. And improved notices, with a plain-language short form on top, would enhance accountability while also communicating far more clearly with ordinary customers. In short, there are surprising merits of the GLB privacy provisions. Considerably more was accomplished in the Act than observers would have predicted in the spring of 1999 or than critics have recognized to date. Important flaws do exist, but specific and achievable changes in the statute and implementing regulation can go far toward reducing the magnitude of those flaws.

Rev. ed. of: Mark Skousen's Complete guide to financial privacy. c1979. Includes index. Bibliography: p. [238]-241.