JUST SIGN ON THE ELECTRONIC LINE
Consumers will be the big losers if a digital signature bill that just passed the House on Tuesday by the lopsided vote of 356-66 ultimately becomes law. And consumer advocates tracking the legislation, sponsored by House Commerce chair Tom Bliley (R-VA), are worried, even though the White House has issued a veto threat. "This is really being worked by the financial services industry," says Margot Saunders of the National Consumer Law Center.
Indeed, the groups pushing the Bliley bill include the American Banking Association, the Financial Services Roundtable, the American Insurance Association, the Securities Industry Association, Microsoft, America On Line, Hewlett-Packard, Schwab, Intuit as well as most of the country's leading banks and mortgage associations. "There is not a company engaged in e-commerce that does not support this legislation," says Rick Lane, director of congressional affairs for e-commerce at the US Chamber of Commerce. At their urging, what started out as a simple measure to give digital signatures the same legal standing as old-fashioned paper contracts expanded into a stealthy attempt to undermine the body of federal consumer protection law.
These interest groups pack a huge campaign finance punch. According to the Center for Responsive Politics, banks, securities firms, insurance companies and computer companies supplied at least $139 million in PAC, soft money and large individual contributions to federal candidates and parties from 1997 to present, sixty percent to Republicans. The top #1 and #2 donors to Bliley's 2000 congressional campaign are the insurance industry and securities and investment firms.
And Bliley's bill delivers the goods, going way beyond what is needed to legalize the use of digital signatures. It would allow nearly all information required under existing laws that protect consumers from unknowingly being hurt to be delivered electronically, instead of on paper. Late payment notices for mortgages, utility bills and insurance coverage could be sent electronically, even if a consumer's computer is broken, or their e-mail is mostly read by their kids. A person could lease a car and be required to sign a contract that says they agree to receive everything on line even if they don't own a computer in the first place!
Worse yet, the Bliley bill would pre-empt all existing state laws and prevent states from enacting tougher measures meant to protect their residents. The only concession Bliley made after vociferous criticism was to modify his bill to require notification in writing of foreclosures, utility disconnects and health insurance cancellations. "We can't get Congress to pass good consumer protections these days related to the Internet because they don't want to get in the way of Internet commerce," says Frank Torres of Consumers Union, "but let business say it wants something related to the Internet and Congress just jumps."
