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Financial Planning > Behavioral Finance

California Group Grades Privacy Policies

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NU Online News Service, Jan. 29, 2004, 1:13 p.m. EST – A California group says 10 financial services companies have flunked its new privacy report card program.[@@]

The Consumer Federation of California Education Foundation, Sacramento, Calif., surveyed 55 insurers, banks and investment brokers.

The group gave its top grade, A plus, to a credit union and 1 insurer, Pacific Life Insurance Company, Newport Beach, Calif.

The group gave a total of 8 grades of A minus or higher, 12 grades in the B range, 19 grades in the C range and 6 grades of D.

The group gave grades of F to 10 companies, and it notes that it could get no privacy information at all either from or about 4 of those companies.

The Consumer Federation based the grades on what steps, if any, financial services companies took beyond the basic federal requirements to limit the sale and sharing of private consumer financial information.

The group gave the highest grades to companies that did not sell or share personally identifiable information without getting permission from their customers. The group gave partial credit to companies that gave consumers a chance to stop distribution of their personal information.

The group says it based the grades on companies’ stated privacy policies and did not test to see whether the companies actually were complying with their privacy policies.