U.S. Bancorp to Pay $3 Million to Settle Privacy Action
U.S. Bancorp will pay more than $3 million to settle claims by Minnesota that the company violated both state and federal laws by providing financial and other sensitive information to telemarketers without their consent. U.S. Bancorp admits no wrongdoing as part of the settlement.
U.S. Bancorp will pay the state $500,000 and contribute $1.5 million to chapters of Habitat for Humanity in Minnesota and $1.03 million to charities or public bodies in other states in which the company operates.
The bank also agreed to tell customers they have the right to decline to share information with bank marketing affiliates and to make refunds to Minnesota customers who purchased the services and were dissatisfied.
Last month, Minnesota attorney general Mike Hatch sued U.S. Bancorp for providing Connecticut-based telemarketer MemberWorks Inc. with its customers’ names, addresses, telephone numbers, gender, marital status, home ownership, occupation, checking account number, credit card number, Social Security number, average account balance, account frequency information, credit limit and other personal data. (See DIRECT Newsline, June 10, 1999).
Congress is currently debating a bill to require banks to keep certain customer data confidential. The U.S. Comptroller of the Currency previously warned the industry to respect customer privacy to avert restrictive legislation.
