[Congressional Record (Bound Edition), Volume 149 (2003), Part 3]
[Extensions of Remarks]
[Page 4117]
[From the U.S. Government Publishing Office, www.gpo.gov]




        INTRODUCTION OF THE PRIVACY PROTECTION CLARIFICATION ACT

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                        HON. CAROLYN B. MALONEY

                              of new york

                    in the house of representatives

                      Thursday, February 13, 2003

  Mrs. MALONEY. Mr. Speaker, I rise today in support of legislation 
that I am reintroducing with my colleague, Representative Judy Biggert 
of Illinois, the Privacy Protection Clarification Act. This legislation 
resolves the controversy as to whether attorneys at law, who are 
subject to strict codes of professional conduct, should be subject to 
the privacy section of the Gramm-Leach-Bliley Act (GLBA). The Biggert-
Maloney legislation recognizes that the practice of law and the 
business of financial services are wholly different and that GLBA 
should be clarified to recognize this distinction.
  With passage of GLBA in 1999, Congress took an important step in 
ensuring that consumer privacy is protected as financial institutions 
continue to merge and as the economy grows increasingly digital. As a 
member of the then Banking Committee, I was proud to play a role in 
requiring that financial services companies supply their customers with 
privacy policies and allow customers the right to opt-out of 
information sharing with third-parties.
  Unfortunately, GLBA has caused significant confusion for the legal 
community. On February 11, 2002, I joined 12 of my bipartisan 
colleagues on the Financial Services Committee in writing to the 
Federal Trade Commission (FTC) to ask that it grant attorneys an 
exemption to the GLBA privacy provisions. As we wrote at the time, 
``Attorneys are already 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 protection than 
GLBA.'' After a thorough review the FTC determined that it does not 
presently have the authority to grant the exemption we requested.
  The privacy protections in Title V of GLBA were a response to 
specific cases where consumers' private, personal financial information 
was mined without their consent in an effort to market products. Where 
Title V is an appropriate response to such cases, it is inappropriate 
to apply it to most lawyers whose clients already expect that all their 
disclosures are confidential, covered by state codes of ethics and 
attorney-client privilege.
  For example, the Legal Aid Society of New York City had to translate 
its privacy notice into many different languages to serve its 
ethnically diverse clientele. It also had to devote an inordinate 
amount of time to dealing with confused clients who could not 
understand why they were getting privacy notices from their lawyers 
when information they share with their lawyers is presumed to be 
confidential. I fear this could have a chilling effect on the 
willingness of individuals to share critical information with their 
attorneys. The confusion these privacy notices are causing in New York 
is unnecessary given that there is express language forbidding the 
sharing of client information in the New York state ethics code for 
lawyers.
  The recently filed amicus brief at the U.S. District Court of the 
District of Columbia by 19 state and local bar associations further 
lays out some of the ways that the Act conflicts with the practice of 
law, the rights of clients and the duties of attorneys. The brief was 
drafted by the former President of the American Law Institute, 
Professor Geoffrey Hazard.
  To quote from the amicus brief: ``Not only does the GLBA provide less 
broad and less beneficial privacy protection than do existing state 
ethics rules governing lawyers, there are contradictions and 
discrepancies in the concepts of confidentiality and in the 
responsibilities of the `service providers' under GLBA as applied to 
practicing lawyers. These disconnections make clear that the 
application of both privacy regimes to lawyers is unworkable. . .'' The 
stringent enforceable codes of professional conduct that attorneys are 
under contain opt-in requirements tailored to the profession. Their 
clients must affirmatively agree to the attorney revealing any personal 
information about that client.
  I join Representative Biggert in introducing this legislation today, 
because it is my intention to target this limited area where the 
interpretation of GLBA can be improved by a legislative fix. The FTC's 
standing interpretation of Title V of the Act is causing confusion that 
is detrimental to the attorney-client relationship. It is appropriate 
for Congress to intervene. I have met with numerous constituents from 
New York City on this issue and am convinced that attorneys should not 
fall under the existing language.
  I look forward to continuing to work to safeguard the privacy of my 
constituents during this Congress. This legislation is limited and 
strictly targeted. As for the larger privacy issues--the American 
public deserves more privacy protections, not fewer. When this body 
passed the GLBA provisions, we never considered its impact upon the 
practice of law because we had not intended it to apply to lawyers. Now 
that we see the confusion, expense and conflict that this act has 
wrought upon the legal community, we must act to clarify our original 
intent.

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