[Congressional Record Volume 149, Number 27 (Thursday, February 13, 2003)]
[Extensions of Remarks]
[Page E244]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




        INTRODUCTION OF THE PRIVACY PROTECTION CLARIFICATION ACT

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                           HON. JUDY BIGGERT

                              of illinois

                    in the house of representatives

                      Thursday, February 13, 2003

  Mrs. BIGGERT. Mr. Speaker, I rise today to join my colleague, Mrs. 
Maloney of New York, in introducing The Privacy Protection 
Clarification Act.
  Gramm-Leach-Bliley was landmark legislation that for the first time 
permitted companies to engage in banking, insurance and securities 
transactions simultaneously. While considering these new freedoms for 
entities to operate across business lines, Congress also wanted to 
ensure that consumer privacy would not be placed at risk.
  Title V sought to address this issue by giving regulators latitude to 
enforce privacy provisions among financial institutions. Unfortunately, 
in interpreting the language of the law, some confusion has arisen over 
what, specifically, those ``financial institutions'' might be.
  Well, in seeking to clarify the confusion, the Federal Trade 
Commission concluded that ``financial institutions'' include any 
business that ``significantly engages in financial activities.'' What's 
the definition of ``significantly''? Well, it could be as little as 
once a year. And what's a financial activity? There are four: debt 
collecting, financial advisory activities, tax planning preparation and 
advising, and leasing real or personal property.
  Okay, that's fair enough. But in writing its regulations in this way, 
the Federal Trade Commission appears to have unintentionally swept 
under its umbrella the one group of professionals that already is 
governed by the strictest possible confidentiality or privacy 
regulations.
  What group is this? It's attorneys.
  Attorneys already are bound by a duty of confidentiality, enforceable 
under the laws of all 50 states, that prevents misuse of client 
information and provides a higher degree of privacy than Gramm-Leach-
Bliley. For example, lawyers in my home state, Illinois, are prohibited 
from releasing confidential information. Our code reads, ``except in 
certain specified circumstances, a lawyer shall not, during or after 
termination of the professional relationship with the client, use or 
reveal a confidence or secret of the client known to the lawyer unless 
the client consents after disclosure.''
  And Illinois is no exception. All 50 states have equally restrictive 
language. In all 50 states, lawyers who violate these laws face 
disbarment and/or other penalties that are much more onerous than those 
for a violation of Title V under Gramm-Leach-Bliley.
  Do attorneys ``significantly engage in financial activities'' as 
defined by the FTC? Yes, some attorneys do give tax-planning advice. 
Others may handle debt collection cases.
  Still others may take up cases related to the other two named 
``financial activities'' providing financial advice or leasing real or 
personal property.
  Yet in order to comply with the privacy provisions under Gramm-Leach-
Bliley, these attorneys now run the risk of violating the client-
confidentiality restrictions placed on their profession.
  Why is that? Well, under the FTC interpretation, every attorney who 
engages in any of the four defined ``financial activities'' for a non-
corporate client must mail to that client a privacy notice--every year, 
for as long as he or she is in practice. And what does that privacy 
notice convey? Well, it informs clients that they may direct their 
attorney not to share their personal information with other entities--
the so-called ``opt-out'' provision of Gramm-Leach-Bliley. Yet the 
attorney-client confidentiality relationship is, by nature, an, opt-
in'' protection.
  In short, for attorneys, the very act of disclosing a privacy policy 
can create a confidentiality violation.
  This was not the intent of Congress. It was not our intent to 
regulate attorney-client relations. Our intent was to regulate the 
growing use and sale of consumers' personal information for marketing, 
profiling and other commercial purposes by banks, thrifts, securities 
firms, insurance companies, credit unions, and other bona fide 
financial institutions.
  At the end of the day, our bill will make the intention of the Gramm-
Leach-Bliley Act crystal clear. The scope of the law was not intended 
to include law firms and sole practicing lawyers.
  I urge my colleagues to support this legislation.

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