Politicians On Layaway, Laws On Standby

As if the banking industry didn't get enough of a gift with last year's corrosive Bankruptcy Abuse Prevention and Consumer Protection Act, they are back this year for more. And just as that bill offered no consumer protections, (on the contrary, it punishes consumers while allowing corporations to continue to break contracts and shed pensions via Chapter 11) their new pet legislation seeks to limit individuals' ability to protect themselves from identity theft. The name of the bill, the Financial Data Protection Act of 2006, is of course completely misleading. While 18 states have provisions for any consumer to "freeze" or limit access to their credit reports, the new "protection" would restrict freezes to those who have already had their identity stolen. And worse, the bill:

With identity theft rampant, and security breaches on the rise - including several examples of lapses by the federal government to go along with countless private sector breakdowns - why is it that consumer protections need to be weakened? The poor bankers say it's just too hard to follow state laws:

It must be tremendously difficult for Bank of America to keep track of all of this on their lone 18th century abacus, but other factors are at work. Disclosing security breaches results in bad press, and it's cheaper to buy a few politicians (of both parties) than to do a better job of protecting consumer data. And more importantly credit freezes cut down on impulse purchases like cars, washer/dryers, and furniture.

When it comes to easy credit, a few bucks in legalized bribery is a small price to pay when the reward is the ability to sell goods with "NO MONEY DOWN / NO PAYMENTS 'TIL 2009!"