WASHINGTON - Efforts by Congress to tighten laws on data security have melted away in a virtual babble of congressional committees.
As many as eight committees in the House and Senate have taken up legislation aimed at curbing data security breaches, ensuring that conflicting agendas and jurisdictions will prevent any bill from being passed this year, according to credit union lobbyists.
“It makes it less likely Congress is going to do anything when you have so many committees with jurisdiction,” said Ryan Donovan, senior lobbyist for CUNA. The issue has been raised now in the House in the Financial Services Committee, which has powers over credit unions and banks; the Commerce Committee, which has authority over the nation’s retailers; the Judiciary Committee and the Small Business Committee. Similar committees in the Senate are also debating the issue.
Credit unions adhere to two major aims in lobbying on the bill. They want parties responsible for a data breach to pay their costs to notify members and reissue cards. And they want MasterCard’s and Visa’s Payment Card Industry security rules, which require merchants to destroy a consumer’s personal card information after completion of a transaction, to be enacted as law.
But the credit unions have come up against a powerful lobby comprised of the nation’s biggest retailers–like TJX–who oppose the concept of responsible party liability, among other things. And the credit unions have been unable to enlist the banks, which have paid at least as much to reissue cards and probably more, in their efforts at reform. Sources say that is because the banks value their relationships with the national retailers more than the costs to resolve card breaches.
CUNA Mutual Group, which has paid out millions of dollars in claims for card fraud in recent years, has been leading the push for a Congressional fix. But failing at that, they have turned their efforts to state legislatures, where the credit union insurer is working with leagues in 31 states to enact laws embodying the two major principles.
“We’re absolutely thrilled that this system has been shut down,” Larry Blanchard, chief lobbyist for CUNA Mutual, said of last week’s charges. “But as long as the data’s flying out there, somebody’s going to get a hold of it, and the data’s still flying out there.”(c) 2008 The Credit Union Journal and SourceMedia, Inc. All Rights Reserved.http://www.cujournal.com http://www.sourcemedia.com
