Financial Services Privacy - the interaction of the privacy and financial services regulatory systems Chris Connolly Financial Services Consumer Policy Centre

2 Overview  Overview of financial services regulation  Common law privacy duties  Codes of Conduct  Update on the Revised EFT Code  How the Codes affect next generation financial services technologies

Financial Services Consumer Policy Centre3 Financial Services Regulation  Common Law: –General duty of confidentiality –Bankers’ duty –Tournier’s Case  Law and Self Regulation : –FSR legislation –Codes of Conduct –New privacy legislation

Financial Services Consumer Policy Centre4 Forces of Change  Convergence  Customer Relationship Management  Electronic Commerce

Financial Services Consumer Policy Centre5 The Post Wallis Regime  General coverage of financial services now via ASIC  FSR Legislation strengthens ASIC role, licensing, disclosure requirements etc.  However, ACCC and state Fair Trading Agencies maintain a role in credit  Privacy Commissioner maintains role in Credit Reporting

Financial Services Consumer Policy Centre6 Australian Codes of Conduct  EFT Code  Banking Code  Credit Union Code  Insurance Codes (x3)  Internet Industry Association Code  Direct Marketing Code  New Model Code

Financial Services Consumer Policy Centre7 Online Financial Services  National policy framework based on: –Contracts - Electronic Transactions Act –Payments - EFT Code review –Conduct – Specific Codes (eg Banking), Model Code and complementary codes (eg IIA Code)  New privacy protection regime

Financial Services Consumer Policy Centre8 The Revised EFT Code  Second discussion paper at:  Progress of the working group  New Code from April 2?  Implementation issues  Issues set aside

Financial Services Consumer Policy Centre9 What will the Code cover?  Business to consumer and business to small business transfers  What is an “electronic transfer of value”?  Coverage of credit cards in some circumstances  Stored value products)

Financial Services Consumer Policy Centre10 What must you do to comply?  A voluntary code - or is it?  Terms and conditions  Records of transactions  Audit trails  Privacy protections as per Privacy Act  Specific privacy ‘guidelines’

Financial Services Consumer Policy Centre11 International Regimes  EU Directive  US Safe Harbour arrangements  EU Guideline on electronic payments  ISO Standards  OECD Electronic Commerce Consumer Protection Principles

Financial Services Consumer Policy Centre12 Conclusion  Most privacy protection in financial services will now be through Codes  New EFT Code will have far reaching consequences - virtually all online financial services will be covered  Next big issue: –Compliance with international regimes

Financial Services Consumer Policy Centre13 The Centre Financial Services Consumer Policy Centre. Law Faculty University of New South Wales NSW 2052 t. (02) f. (02)