Privacy. Now. Tomorrow. Forever!

My bank is really concerned about my privacy. I know they are. I can`t tell you how many notices I`ve gotten in the mail assuring me of it. I bet you have too. And it`s not just those damn statements, with their small print that defies reading. It`s more than that. It`s this whole flap about privacy that is the banking issue du jour in Congress and statehouses around the country right now. Most of the flap is centered on what a bank can or can`t do in terms of using and/or releasing private information to third parties. I think it`s time to call a spade a spade: This flap is about (surprise!) money. It`s not much about privacy at all. For the most part, big banks and Republicans are promoting an “opt-out” policy that makes widely available to consumers the ability to opt out of any scheme by which their bank might release address and account information. Democrats, at least those who think there`s a popular issue here, are pushing for an “opt-in” approach, where nobody does nuttin` unless the customer has affirmatively said they can do it.

And the forces line up this way not because one side cares more about your privacy than the other, but because big banks have for years been making big bucks selling stuff to bank customers. Credit card holders, especially, are fair game, because they like to buy. They especially like to buy when sold over the telephone by a company that has access to their credit card information, so no one is asked unseemly questions like “What`s your account number?” Confused about where you should stand? Let us help. As a consumer, should I worry about what my bank does with my private information? Sure, but don`t worry too much. Banks have a great asset in knowing your most private information and don`t want competitors or potential competitors to have it. Self-interest is your friend here. Why the big deal about opt-in or opt-out anyway? Won`t people do what they want to do? No. Inertia rules in banking.

People won`t take the time to opt-inu00e2u20ac”which means banks would have far fewer people to market to, far fewer people whose names can be rented to third parties. Nor will customers opt-out, if that`s the chosen wayu00e2u20ac”good news for the aggressive bank, which is exactly why the big banks find it so reasonable. As a bank director, should I urge my congressmen and senators to push for the industry`s opt-out privacy stance? The realpolitik answer is yes, if your bank wants to market stuff to your customers, and wants to keep open the option of letting a third party do the heavy lifting.

If you think there`s a philosophical issue here, and that it`s time to hold the line, opt-in is for you. But don`t forget how tough it will be to sell insurance only to those customers who say, “Send me all that insurance info, and have that salesman call at suppertime, too.” Why do all the European countries have a strict “opt-in” policy? Do they care more?

No. The Europeans were slow to market goods and services to bank customers, so they have neither earnings to protect nor powerful banks and third parties saying, “Whoa, this could kill the golden goose.” What about this new proposal to limit the release of social security numbers? Now there`s a compromise we can all support! Since your social security number is about as valuable to your bank as your 1970 draft status, by all means pass a law protecting its sanctity! There`s serious business happening out there, fellow directors. It just happens the privacy issue, as it`s now shaping up, isn`t one of them.

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