LEGISLATION

Oct 01, 1999 9:30 PM  By

Congress is looking at opt-in and opt-out policies as part of two privacy-related bills that could make it more difficult for marketers to obtain consumer data.

At press time, Congress was waiting to convene a House/Senate conference committee on H.R. 10 Title V, Privacy of Consumer Information/ Disclosure of Nonpublic Personal Information, from the Financial Services Act introduced in January by Rep. James Leach (R-IA). H.R. 10 would prevent financial institutions from sharing with other marketers any nonpublic personal information they have collected, unless they give the consumers the ability to opt out.

The overall bill “affects a lot of different interests, so it will be a long undertaking,” says Stephen Altobelli, a spokesman for the Direct Marketing Association. He would not speculate on how long it would take for the bill to face a vote, nor on a likely outcome.

Mailers generally view opt-out, in which consumers ask to be removed from mailing lists, as less stringent than opt-in. In the latter, marketers cannot send ad materials unless a consumer requests them, nor can organizations share data about the consumer unless he or she gives permission. The other privacy-related bill, S. 1143, is a Senate appropriations bill that would force states to adopt opt-in policies regarding the release of personal Department of Motor Vehicles (DMV) data; states that didn’t comply would lose federal transportation funding.

“If passed in its current state, this bill would represent a fundamental change in how catalogers and other marketers could get access to DMV information,” Altobelli says. As of early September, the bill was waiting for action from the full Senate.

But a recent court ruling questions the legality of S. 1143. The U.S. 10th Circuit Court of Appeals in Denver on Aug. 18 overturned a Federal Communications Commission (FCC) regulation requiring phone companies to obtain permission from consumers before using data (on how customers use their phone service) for marketing purposes. The court said that the FCC violated the First Amendment when it adopted the regulation last year without justifying its decision to adopt opt-in rather than opt-out.