Legislature(2001 - 2002)
04/25/2001 03:30 PM House L&C
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* first hearing in first committee of referral
+ teleconferenced
= bill was previously heard/scheduled
+ teleconferenced
= bill was previously heard/scheduled
HB 106 - FINANCIAL INSTITUTIONS [Contains discussion of HB 184 and SB 66] Number 0081 CHAIR MURKOWSKI announced that the first order of business would be HOUSE BILL NO. 106, "An Act relating to the authorizations for state financial institutions; relating to confidential financial records of depositors and customers of certain financial institutions; relating to the Alaska Banking Code, Mutual Savings Bank Act, Alaska Small Loans Act, and Alaska Credit Union Act; and providing for an effective date." CHAIR MURKOWSKI reminded members that during a previous hearing she had emphasized the necessity of working on HB 106 in concert with HB 184, to ensure uniformity with regard to the related privacy issues including financial disclosures and certain health information disclosures. Number 0255 REPRESENTATIVE HALCRO made a motion to adopt the proposed committee substitute (CS), version 22-GH1026\F, Bannister, 4/19/01, as a work draft. There being no objection, Version F was before the committee. Number 0290 FRANKLIN TERRY ELDER, Director, Division of Banking, Securities and Corporations, Department of Community and Economic Development, stated that he understands that [Version F] reflects much of the work done in the Senate Labor and Commerce Standing Committee on SB 66. However, a large exception regarding policy is that the reference to the Gramm-Leach-Bliley Act (GLBA) was removed in HB 106 from the privacy section, AS 06.01.028, making it essentially an opt-in bill. That removal is the department's preference, he indicated, and although it also was requested of the Senate Labor and Commerce Standing Committee [regarding SB 66], that change wasn't made. Mr. Elder expressed hope that the change could be done on the Senate side as well. MR. ELDER highlighted two small "nonpolicy" differences between HB 106 and SB 66. First, [Version F of HB 106] adds the reference to the National Credit Union Administration (NCUA), which didn't make it into the Senate bill. Mr. Elder remarked, "As a policy, we work with both the FDIC [Federal Deposit Insurance Corporation] and the NCUA when we do examinations; and so I was, I guess, a little surprised that didn't make it in, in the Senate bill, but you've taken care of that ... in this committee substitute." He noted that second, [Version F] takes care of the slight difference in the ATM [automated teller machine] section on credit unions, with the small wording change being the same as for ATMs at banks. Number 0502 MR. ELDER informed members that the other major event from the department's viewpoint, in conjunction with the committee's work on Version F, has been to have further discussions with the Alaska Bankers Association to find common ground for protecting Alaskans' privacy while still making the everyday work of financial institutions run smoothly, while at the same time considering the differences between small banks, which may have few or no affiliates, and larger ones. MR. ELDER pointed out that when talking about sharing or selling information for banks and credit unions covered by the Fair Credit Reporting Act (FCRA), the FCRA regulates the sharing of information among affiliates. It preempts any state restrictions on sharing among affiliates until January 2004, after which time [the legislature] needs to pass a bill that references the FCRA in order to overcome the preemption. By contrast, the Gramm-Leach-Bliley Act only deals with the sharing of information with nonaffiliates. Number 0655 MR. ELDER reported on the department's further conversations with the Alaska Bankers Association. He said it is his understanding that the department and the association had agreed upon some clarifying language in subsection (d) of AS 06.01.028, which allows for financial institutions to share information necessary to provide services. In testimony on that section, both on the Senate side and in a letter to Representative Halcro, Mr. Elder said he had stated that he thought that would also cover joint marketing efforts. He expressed the belief that the language agreed upon by the department and the Alaska Bankers Association clarifies that it includes joint marketing efforts. CHAIR MURKOWSKI asked Mr. Elder whether he had a copy of proposed amendment F.1 [22-GH1026\F.1, Bannister, 4/23/01], which read: Page 3, lines 24 - 25: Delete all material and insert: "(1) the disclosure is necessary to (A) provide the services of the financial institution to a depositor or customer; or (B) market financially related products or services of the financial institution and its marketing partners; and" MR. ELDER affirmed that Amendment F.1 is the language agreed upon by the department and the bankers association. He pointed out that the specific clarifying language is in subparagraph (1)(B). Number 0775 MR. ELDER emphasized that [under Amendment F.1] the information to be shared must be necessary, not just extraneous. Furthermore, it must be financially related services of the financial institution and its marketing partners. He noted that subsection (d) requires a contractual relationship, in writing, between the financial institution and the marketing partner, saying that the marketing partner will be subject to the privacy restrictions of AS 06.01.028. Mr. Elder characterized that provision as "fairly powerful," emphasizing that it truly would be a marketing partner, rather than a telemarketer, who might not be willing to enter into such an [agreement]. Number 0840 REPRESENTATIVE HALCRO asked whether an unaffiliated mortgage company having a brochure in a bank is "sharing information" or whether Mr. Elder is talking about the banks giving out information about a specific customer. MR. ELDER suggested that a decision to allow a company to put a brochure in the lobby, which anyone could pick up, probably wouldn't be contemplated here. Rather, this relates to privacy in terms of providing, for marketing purposes, information that is in the possession of a financial institution. It may have been obtained from a variety of sources, he noted, including directly from the consumer, or indirectly from credit reports or other reports. Amendment F.1 limits it to "financially related," and there would have to be a contractual agreement if one company were receiving any of that nonpublic information. REPRESENTATIVE HALCRO said one argument for the "opt-out" is that the current law is so strict that it doesn't provide for a mortgage company to put a brochure in the lobby. He expressed concern that privacy should relate to the sharing of account information, for example, or payees on checks. MR. ELDER concurred. Number 1031 REPRESENTATIVE CRAWFORD referred to subparagraph (A), Amendment F.1. He inquired about defining the term "services"; he said it seems very broad. MR. ELDER reported that he had come to agree with the bankers' position that ten people, when making a list of services, would provide ten different lists; a month from now, those lists would change. Therefore, it would be difficult to lock in a specific list of services of a financial institution. Changing that list later would require either a regulatory action or a statutory change. Mr. Elder also expressed his belief that if there were an issue regarding this - whether in front of a hearing officer if the department had brought an action, or before a court - the court [or hearing officer] could look at something and determine whether it is a service offered by the institution. REPRESENTATIVE CRAWFORD noted that the committee is trying to go with opt-in, and this is an exception. He asked whether it shouldn't, therefore, be the fewest services that are exceptions, such as check-printing and other services that had been discussed previously. MR. ELDER answered that he believes this language is more workable than having a list, and that it is sufficiently limited by the word "necessary". He said subparagraph (A) isn't talking about marketing in that regard, because these people already are customers, including depositors. Furthermore, it relates to providing services of the institution for which people have chosen to have a customer relationship. REPRESENTATIVE CRAWFORD asked whether, for example, a bank or credit union would be able to share with its insurance company how timely a customer had been regarding payments for a car loan. He asked whether that could be construed as a service. MR. ELDER replied, "Not under (A), because under (A) it's talking about the financial institution, and so ... it wouldn't be sharing ... the information for somebody else to provide the services." He said it is more limited than one might think. He cited as obvious examples the statement-printing and check- printing. He restated his concern about coming up with a list of all the possible services of an institution. Number 1345 REPRESENTATIVE CRAWFORD turned the committee's attention to subparagraph (B) of Amendment F.1, noting that it says "market financially related products". He asked whether an institution would be able to share without a customer's opting in. MR. ELDER answered that under (B), he would say that "insurance product" is a financially related service - if the two were affiliated, there could be sharing anyway. If the two were not affiliated, and if there were a contractual relationship between the insurance company and the financial institution, they could provide information that is relevant - necessary - to the service. REPRESENTATIVE CRAWFORD asked whether that would be true even if the consumer didn't opt in. MR. ELDER affirmed that. He added that otherwise, small banks such as many Alaskan banks would be at a significantly competitive disadvantage when compared to larger, generally national, banks that have an affiliate structure. For example, having an affiliate insurance company would force smaller banks either to not compete, to seek out those kinds of affiliations, or to be purchased by bigger institutions. Number 1501 REPRESENTATIVE HALCRO reported that he had received an e-mail that day from the Alaska Public Interest Research Group (AkPIRG), which said HB 106 would strip the cap off of credit card interest rates. He asked whether it would, in fact, do so. MR. ELDER referred to Section 13, page 9, Version F, saying the division and the state had proposed that it remove the current cap of 17 percent on credit card charges. He explained the reason for that language. He said "our" view is that a cap such as this essentially has no effect on the interest rates paid by most Alaskans on their charge cards. Instead, it only prevents smaller, state-chartered institutions from participating in the credit card business. He noted that of the six state-chartered institutions in Alaska, three don't offer credit cards, and three offer them but don't "push" them. He surmised that [offering credit cards] comes more from a desire to be a full- service institution or from the fact that credit cards may be a means of providing overdraft protection for checking accounts. MR. ELDER reported that [the department] also looked at what the legislature did in 1996 in amending the retail installment sales Act, which is in Title 45. The cap on interest rates was changed at that time to essentially whatever was negotiated between the institution and the borrower. Noting that he has a background as an economist, Mr. Elder said a cap is effective only if the market rate would be higher; otherwise, all a cap does is create a shortage, because the demand would exceed the supply at that price. Mr. Elder said that is what he believes has happened, since half of the state-chartered institutions don't offer credit cards. Number 1713 MR. ELDER suggested that one test is looking at the credit cards in one's wallet; if they are from major banks, the rates will vary widely - having no relationship to the 17 percent - because federal law allows banks that operate in more than one state to "export" interest rates. Mr. Elder suggested that a cap may even go against economic development by ensuring that the decisions will be made outside of the state, because in order to export interest rates, they must be made in other states. He then stated: We honestly don't believe that if House Bill 106 passes and becomes law this way, and that [the] cap is removed, ... people will see any difference in the interest rates that they pay on the credit cards that they are likely to have in their wallet. The only possible difference would be that perhaps a state- chartered financial institution that they otherwise do business with will also offer credit cards. ... I don't think it is anti-consumer or anything like that. But having said that, the will of the committee and the will of the legislature are fine with me. ... It's not a Gramm-Leach-Bliley issue. I think it's more of ... a fairness-to-state-banks-versus-out-of- state-banks and ... a small-bank-versus-large-bank issue. ... I'd like to see bipartisan support of House Bill 106, and if that is the only section that was preventing bipartisan support for the bill, then ... I wouldn't have any strong feeling, one way or the other, if the legislature chose not to include it. Number 1851 REPRESENTATIVE HALCRO summarized his understanding of what Mr. Elder was saying: first, it doesn't come into play for people whose credit cards come from outside of Alaska, and second, it impedes the success of state banks, which can't charge a decent rate in order to make money. MR. ELDER concurred, again saying it is a matter of what is fair to state-chartered institutions, which is the reason for its inclusion. Number 1903 CHAIR MURKOWSKI brought attention to an e-mail that referenced "an Office of the Comptroller of Currency decision, apparently, OCC letter number 822," which provides that when a national bank has branch offices in a state and makes credit determinations in that state, that bank must follows the state's law. She said the individual's concern was that if there were no cap in Alaska, then a Wells Fargo Bank could issue an out-of-state credit card and charge usurious rates. MR. ELDER said the federal law that governs the ability to export interest rates does say that; one criterion is where the credit decision is made. He said the banks know that and can structure their operations to show that the credit decisions are made in whatever state they need to have the credit decisions made in. Therefore, a 17 percent cap in Alaska means almost nothing to a true multi-state bank. Furthermore, nobody puts a gun to someone's head and makes that person use a credit card; people sign up for credit cards, and most people notice what the rates are. He said it is a competitive business. If a bank offered a truly usurious rate, he suggested that people wouldn't take it. CHAIR MURKOWSKI indicated her belief that Alaska has usury laws. REPRESENTATIVE ROKEBERG disagreed, saying the usury laws were abolished because they don't make sense anymore. He mentioned a credit reporting Act. He then said market principles are there, and it is clear, from the testimony, that state banks cannot compete with national banks because of the artificial cap. He indicated that the only thing in Alaska's statutes relating to usury is "some nonfloating-rate legal interest rates," which he said he was going to look into. CHAIR MURKOWSKI said she would like to hear from the bankers before there was a motion to adopt Amendment F.1. She asked whether there were further questions of Mr. Elder; none were offered. Number 2107 JOE SCHIERHERN, Senior Vice President, Northrim Bank, testified via teleconference, noting that he was a charter employee of the bank and has worked primarily in the commercial loan area over the last ten years. He informed members that he formerly was president of the Alaska Bankers Association. He added that the Alaska Bankers Association and Northrim Bank are in favor of Version F and concur with Mr. Elder's testimony. MR. SCHIERHERN addressed the need for Amendment F.1 to allow the marketing of bank services to the public. He referred to Mr. Elder's testimony that the FCRA preempts any regulation of banks with affiliates. Mr. Schierhern said a bank with an insurance affiliate would be allowed to freely market its services to the affiliate; by contrast, a smaller state bank without such an affiliate could not do that without the amendment. He emphasized the importance of the amendment in order to provide fairness, allowing state-regulated banks to be on an equal footing with larger national banks with affiliates. He added that another central point is the ability for consumers to receive a free flow of information. Without these provision, he said he thinks the opportunity to choose and the opportunity to receive information would be inhibited. Number 2252 LAURA WALDON, Alaska Public Interest Group, testified via teleconference. She stated that she doesn't think HB 106 will focus on the local people, because it allows [the banks] to charge people anything they want. She said people don't realize that their [interest] rates are changing until they get their bill. LISA BELL, Senior Vice President, Chief Operating Officer, Alaska Pacific Bank, testified on behalf of the Alaska Bankers Association. She noted that [the Alaska Bankers Association] is in complete agreement with the Division of Banking, Securities and Corporations, and is in support of the proposed committee substitute and the proposed amendment. She remarked: We as bankers are not interested in selling lists of customer information to third parties. We have our reputation to protect. What we are interested in doing is being able to market our own products and services, and to be able to market financially related products and services that we may not be able to offer in-house. ... We believe that this legislation, with the proposed amendment, does exactly that for us, and also protects the privacy interest of Alaskans. Number 2396 REPRESENTATIVE CRAWFORD asked Ms. Bell what personal financial information she would share if she were only marketing products to somebody the bank has a relationship with. MS. BELL answered that it is possible that some household characteristics would be shared, which might allow [the bank] to determine if the product would be of interest to that household. For example, it could be household income or average balances. The bank might want to know who would be interested in an account that would have a minimum balance requirement of $2,500; therefore, [the bank] would not be marketing it to people who would be outside that range. REPRESENTATIVE CRAWFORD asked, if based on that information, whether someone would be able to receive services that wouldn't be offered to someone who didn't have the $2,500 minimum balance. MS. BELL replied that she could have given a poor example; however, it's possible. Depending on the product or service, [the bank] may want to offer it to everyone. However, it depends on what the products are. They could be trust, brokerage, or insurance services, which she thinks are the most common three things her bank would want to market to customers that can't be offered in-house. She added that small banks probably don't have a long list of things they would want to engage in. TAPE 01-67, SIDE B MS. BELL continued [inaudible due to tape failure]. She stated that it is quite possible that database sorting would be done within the bank and not even need to be shared with a third party, because in the end, the bank is possibly paring down a list and only sharing names and addresses in order for a mailing to go out. Number 2455 REPRESENTATIVE CRAWFORD asked Ms. Bell if she wouldn't be adverse to limiting what would be shared to just the name and address, if the list has already been limited within the bank. MS. BELL replied that she would be concerned if limitations were placed on what is shared without knowing what the opportunities in the future might be. She said this could create an undue restriction on the kinds of financial services [the bank] might be able to offer. REPRESENTATIVE CRAWFORD remarked that it seems to him, if the bank wants to share more information, [the bank] should get an opt-in provision whereby the consumer would say it is OK to share something more [than just name, address, phone number, birthday, or occupation]. MS. BELL responded that she would feel that [the bank] would have to be very careful in placing those limitations. A smaller bank may not have thought of all the possible opportunities. For example, there could be a situation in which the partner [of a smaller bank] has a more sophisticated system that sorts, looks at the demographics, and determines what products a person would be interested in. REPRESENTATIVE CRAWFORD commented that he is concerned that [HB 106] may be discriminating against a large segment of the marketplace based on other information. MS. BELL replied that she wouldn't want to mislead [the committee] on guessing what types of information might be shared or what kinds of demographics might be used in a "sort," since she has never engaged in that kind of a joint-marketing agreement with a third party. REPRESENTATIVE CRAWFORD added that if someone could more specifically show him a need to share more information, he might be more amenable to going along with it. Number 2337 REPRESENTATIVE ROKEBERG referred to Amendment F.1, subparagraph (B), and stated that he thinks the theory is it would allow state banks to have "equal footing" with large national banks by granting them the disclosures necessary to market financially related products or services of the financial institution and its marketing partners. MS. BELL agreed. REPRESENTATIVE ROKEBERG stated that he'd read the provision in the context of the exceptions that were delineated under subparagraphs (A), (B), and (C) [on page 2 of the proposed CS]. He asked Ms. Bell whether she would consider the proposed subparagraph (B) as an opt-in or an opt-out. He said it seems that the way it's drafted, it is an opt-out, and the customer would have to declare that he or she wouldn't want that information divulged. MS. BELL answered that her interpretation is it really does stick with a default opt-in for many circumstances, except for the basic exceptions already included in the statute for the normal course of banking. She said this amendment allows, particularly, the smaller banks the opportunity to go a little further in marketing other products and services that cannot be offered in-house. REPRESENTATIVE ROKEBERG asked whether her interpretation is that this would occur without the permission of the customer. MS. BELL agreed, and stated that this would be an exception to opt-in; however, there are still requirements under the GLBA that would require the bank to have a contract with the third party. REPRESENTATIVE ROKEBERG asked Mr. Elder if conformance with the GLBA is in the bill. Number 2225 MR. ELDER answered that there are aspects of the GLBA that apply to the bank regardless of what is done in terms of opt-in or opt-out. He explained that subsection (f) [on page 3] is an exception to the general rule that disclosure of information is not allowed, and subsections (a) through (c) state when that is allowed. The purpose of subsection (d) is to level the "playing field" between the small state-charted banks that don't have affiliate structures and the larger banks that do. REPRESENTATIVE ROKEBERG asked whether it would not be consistent with the GLBA to say "state-chartered banks", if there were any enforcement on the national level. MR. ELDER responded that the idea is that in [Alaska] smaller banks tend to be state-chartered banks, but nationwide there are some large state-chartered banks. He stated that the issue isn't necessarily whether it's state-chartered or national, but whether it has an affiliate structure or not. He noted that it just so happens that in [Alaska] the state banks are also smaller banks and tend not to have an affiliate structure. He emphasized that subsection (d) is designed to allow smaller banks to do things that other banks can already do because of their affiliate structure. CHAIR MURKOWSKI asked, if [HB 106] is trying to give equal footing to the state-chartered banks, whether it could be specified that the state banks are brought up to parity with their ability to do the [agreement]. MR. ELDER, in response, reiterated that the purpose of subsection (d) is to level the playing field between banks that have large affiliate structures and banks that don't, regardless of their charter. CHAIR MURKOWSKI asked Mr. Elder if he would be reluctant to specify that it is a state financial institution because that is just the way it is right now. MR. ELDER agreed. Number 2012 REPRESENTATIVE ROKEBERG asked if, under the proposed subparagraph (d)(1)(B) and the proposed CS, banks have the right to opt back in. MR. ELDER responded that the bill and the amendment are written with information that is necessary to provide the services of the institution, or to conduct joint-marketing efforts of that institution with its marketing partners where there is a contractual relationship. He explained that he thinks it's limited by the fact that it is necessary information, it's financially related services, and there has to be a written contract between the financial institution and the partner that they will be subject to the limitations in subsections (a) through (c). REPRESENTATIVE ROKEBERG asked, if [the committee] adopts Amendment F.1, where in the bill it would provide that the opt- out provision would be sent out [to customers]. MR. ELDER answered that if [the committee] passes the bill as it is, opt-in is in paragraph (a)(1) [on page 2]. He added that the Gramm-Leach-Bliley requirement, which the banks - including the state banks - are still subject to, requires that a privacy notice be sent. Number 1794 CHAIR MURKOWSKI asked, by opting-in, if the Gramm-Leach-Bliley provisions are still in play, but there will be a higher standard when it comes to privacy. MR. ELDER agreed. REPRESENTATIVE ROKEBERG stated that also, those institutions with large affiliate structure have been allowed to have co- marketing parties. MR. ELDER responded that institutions with large affiliate structures already have large marketing parties, which is why subsection (d) is necessary. Should [institutions] not have an affiliate in a certain area that's a financially related area, and should they want to operate under a contractual arrangement just like any other bank, then subsection (d) would allow them to do that. He added that the contractual obligation is there because it binds them to the rest of the sections of the privacy provision, it's limited to financial services, and it has to be a joint effort. REPRESENTATIVE ROKEBERG asked Mr. Elder whether there is a natural disincentive within the structure of an institution with a large number of affiliates to compete against itself. He said the natural flow of things is that this would allow the smaller, less-affiliated institution to be able to compete with a larger one. MR. ELDER agreed. CHAIR MURKOWSKI remarked that she was trying to suggest that [the committee] limit the amendment to only state-chartered institutions. However, she said she was reminded, for example, that Alaska Pacific Bank is a federally chartered bank, but doesn't have any affiliates. Therefore, if the amendment were limited, [the committee] wouldn't really have done what they want to do, which is to allow the smaller state banks [to do things that other banks can because of their affiliate structure]. MR. ELDER stated that that is exactly why subsection (d) is written the way it is - to only address the difference in affiliate structures. He added that one thing that needs to be kept in mind when talking about information that is shared or sold under Gramm-Leach-Bliley is that the restriction is on nonpublic information. Therefore, there are no restrictions on things that are available publicly. Number 1582 REPRESENTATIVE HALCRO referred to Ms. Bell's comment about how the intention is not to sell lists. He asked her, if she were to create a prospective list of customers based on an average daily or monthly balance, and she was going to do a joint marketing with somebody who offered market accounts, what her bank would get for providing that list. MS. BELL answered that there would be two types of benefits from it. [Her bank] would hopefully retain the customer, who might have otherwise taken his or her money out and put it in a brokerage account, and [her bank] might get an interest override paid back on the funds that are basically sent out of the bank. REPRESENTATIVE CRAWFORD commented that a few years ago he decided not to do business with a couple of the larger banks in [Alaska] because he wasn't getting good, individualized service. He asked Ms. Bell if she thinks one of the plusses about smaller banks is that they provide more individualized service. He remarked that it seems to him that now [these smaller banks] want to get bigger. MS. BELL responded that she understands Representative Halcro's point and she agrees with him. She stated that she doesn't think any small bank in Alaska has an intention of "stuffing people's mailboxes" with all kinds of offers. She said she thinks they want the ability to do selective kinds of marketing for products that they think will help retain customers. REPRESENTATIVE HALCRO stated that it seems to him from subparagraph (B) in the proposed amendment that [the smaller banks are marketing financially related products or services] without accepting an opt-in. MS. BELL remarked that paragraph (B) is an exception to opt-in. REPRESENTATIVE HALCRO asked if it would be OK to first check with [the consumers] to see if they are interested in receiving that material. Number 1346 MS. BELL responded that she thinks the whole point of the amendment was to allow [banks], without a lot of expense and effort, to be able to offer something to a large portion of the customer base so that they could look at it at their leisure and make their own decisions. She stated that it is far more expensive and time-consuming to seek opt-in; it would probably prevent some of these offers from ever taking place. She said the return rate is not very high when people have to say, "Yes, I want to receive more mail." Opt-in is still preserved in many circumstances under this legislation, and certainly for any nonfinacially related products. REPRESENTATIVE HALCRO asked whether financially related products are the only things that [banks want to share]. MS. BELL stated that that is the only thing her bank would want to share. REPRESENTATIVE HALCRO remarked that opt-in wouldn't be preserved in anything except for financially related products. MS. BELL responded that preserving opt-in for the rest of the field of possibilities protects the privacy of Alaskans. Number 1151 STEVE CONN, Alaska Public Interest Research Group, testified via teleconference. He stated that the purpose of the GLBA was to break down the barriers between financial institutions. (Indisc.) He said the issue of the caps on interest rates and the response of Mr. Elder were quite revealing, because not only do working people lose the protection of the 17 percent, it opens the possibility that the out-of-state banks will make their decisions here and that the "sky will be the limit." He concluded by saying that both bills [HB 106 and HB 186] lack private rights of action. This is in high contrast to a bill moving through the Senate and the House related to the automobile dealers their manufacturers, and the franchise relationships whereby the consumers are talking directly to the automobile dealers and to the Department of Law's representative. This bill, he said, is outside the realm of consumer protection, and it "cries out" for private rights of action to be installed, because "we" simply cannot trust those who only speak to bankers and never speak to consumers. Number 1042 REPRESENTATIVE HAYES made a motion to adopt Amendment 1 [22- GH1026\F.1, Bannister, 4/23/01], which read: Page 3, lines 24 - 25: Delete all material and insert: "(1) the disclosure is necessary to (A) provide the services of the financial institution to a depositor or customer; or (B) market financially related products or services of the financial institution and its marketing partners; and" REPRESENTATIVE CRAWFORD objected. He stated that he believes subparagraph (B) of the amendment takes out the opt-in provision for anything financially related, and therefore "guts" the language. CHAIR MURKOWSKI disagreed. She stated that she thinks an effort has been made to preserve the opt-in policies in reference to information, whether it be financial information or personal health information. When this was first discussed, it was all opt-out; however, it is recognized in Alaska that there are greater privacy protections. She remarked that she thinks there has to be certain exceptions to that in order to allow state institutions to offer the type of services that are expected. She noted that a bank's competition is no longer another bank; people are putting their money everywhere else except a bank. REPRESENTATIVE CRAWFORD withdrew his objection. Number 0795 CHAIR MURKOWSKI announced that there being no further objection, Amendment 1 was adopted. REPRESENTATIVE HAYES moved to report CSHB 106, version 22- GH1026\F, Bannister, 4/19/01, as amended, out of committee with individual recommendations and the attached zero fiscal note. There being no objection, CSHB 106(L&C) moved from the House Labor and Commerce Standing Committee.
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