Connecticut Seal

General Assembly

 

Raised Bill No. 7073

January Session, 2007

 

LCO No. 3961

 

*03961_______BA_*

Referred to Committee on Banks

 

Introduced by:

 

(BA )

 

AN ACT PROTECTING CONSUMERS' PRIVACY IN MORTGAGE APPLICATIONS.

Be it enacted by the Senate and House of Representatives in General Assembly convened:

Section 1. Section 36a-41 of the general statutes is repealed and the following is substituted in lieu thereof (Effective October 1, 2007):

As used in sections 36a-41 to 36a-45, inclusive, as amended by this act:

(1) "Financial institution" means a bank, Connecticut credit union, federal credit union, an out-of-state bank that maintains a branch in this state and an out-of-state credit union that maintains an office in this state.

(2) "Financial records" means any original or any copy, whether physically or electronically retained, of: (A) A document granting signature authority over a deposit account or a share account with a financial institution; (B) a statement, ledger card or other record on any deposit account or share account with a financial institution which shows each transaction in or with respect to that account; (C) any check, draft or money order drawn on a financial institution or issued and payable by such an institution; or (D) any item, other than an institutional or periodic charge, made pursuant to any agreement by a financial institution and a customer which constitutes a debit or credit to that person's deposit account or share account with such financial institution if the item is not included in subparagraph (C) of this subdivision.

(3) "Mortgage trigger lead" means a consumer report obtained pursuant to Section 604 (c)(1)(B) of the federal Fair Credit Reporting Act, 15 USC 1681b, where the issuance of the report is triggered by an inquiry made with the consumer reporting agency in response to an application for credit. The term does not include a report obtained by a lender that holds or services existing indebtedness of the applicant who is the subject of the report.

Sec. 2. Section 36a-42 of the general statutes is repealed and the following is substituted in lieu thereof (Effective October 1, 2007):

(a) A financial institution may not disclose to any person, except to the customer or the customer's duly authorized agent, any financial records relating to such customer unless the customer has authorized disclosure to such person or the financial records are disclosed in response to (1) a certificate signed by the Commissioner of Administrative Services or the Commissioner of Social Services pursuant to the provisions of section 17b-137, (2) a lawful subpoena, summons, warrant or court order as provided in section 36a-43, (3) interrogatories by a judgment creditor or a demand by a levying officer as provided in sections 52-351b and 52-356a, (4) a certificate issued by a medical provider or its attorney under subsection (b) of section 17b-124, provided nothing in this subsection shall require the provider or its attorney to furnish to the financial institution any application for medical assistance filed pursuant to an agreement with the IV-D agency under subsection (c) of section 17b-137, (5) a certificate signed by the Commissioner of Veterans' Affairs pursuant to section 27-117, or (6) the consent of an elderly person or the representative of such elderly person provided to a person, department, agency or commission pursuant to section 17b-454, provided the financial institution shall have no obligation to determine the capacity of such elderly person or the representative of such elderly person to provide such consent.

(b) No first mortgage broker or mortgage lender, as defined in section 36a-485, and no secondary mortgage broker or mortgage lender, as defined in section 36a-510, shall use a mortgage trigger lead in connection with the solicitation of an application for a loan or a line of credit that would be secured by a lien on residential real property located in this state.

This act shall take effect as follows and shall amend the following sections:

Section 1

October 1, 2007

36a-41

Sec. 2

October 1, 2007

36a-42

Statement of Purpose:

To protect consumers from the unauthorized use of their personal information and resulting solicitations by prohibiting mortgage lenders from using any credit bureau's "lead generating" product in Connecticut.

[Proposed deletions are enclosed in brackets. Proposed additions are indicated by underline, except that when the entire text of a bill or resolution or a section of a bill or resolution is new, it is not underlined.]