Mar 14 2001


Bill Restricts Financial Institutions Sharing of "Behavioral Profiles" of Customers

 U.S. Senator Richard C. Shelby (R-AL) today introduced legislation to prohibit financial institutions from sharing and selling their customers personal spending information or "behavioral profiles" without their consent.

The Freedom from Behavioral Profiling Act of 2001 amends the financial services modernization bill to require financial institutions to obtain their customers' approval prior to sharing personally identifiable behavioral profiling information, such as where and how an individual spends and receives his or her money. The legislation is intended to stop the dissemination of an individual's psychological and behavioral profile-based on personal and detailed buying habits-without the individual's prior knowledge and affirmative consent.

"We all expect our banking information to remain private and secure, but nothing could be further from the truth," said Shelby. "While we sleep, our financial institutions are sharing and selling the most intimate details of our daily lives."

"The American people are only now becoming aware of the behavioral profiling practices of the industry," continued Shelby. "The more they find out, the more they do not like it. That is why I am offering this legislation--to give the consumer the ability to control how, and with whom, financial institutions share our spending information. Why does a financial institution need to know what medicines we use, what foods we eat, where we go, or what books we read? Why should they be selling this information without our permission? Where they go, who they see, what they buy and when they do it--all of these are personal decisions that the majority of Americans do not want monitored and recorded without their knowledge or consent ."

The legislation would not prevent financial institutions from recording or tracking individuals' spending habits as a security measure or to combat fraud.

The Freedom from Behavioral Profiling Act of 2001 has been introduced today following yesterday's hearing by the Federal Trade Commission to examine the exchange of consumer profiles. The public hearing was held in response to Senator Shelby's concerns with the privacy implications of consumer profile exchanges and the creation of computer systems designed to improve the exchange of private information such as identification numbers and behavioral data.