BILL NUMBER: SB 1237	AMENDED
	BILL TEXT

	AMENDED IN ASSEMBLY  JUNE 19, 2002
	AMENDED IN SENATE  MAY 13, 2002
	AMENDED IN SENATE  APRIL 22, 2002

INTRODUCED BY   Senator Speier

                        JANUARY 7, 2002

   An act to add Section 4105.5 to the Commercial Code, relating to
banks.



	LEGISLATIVE COUNSEL'S DIGEST


   SB 1237, as amended, Speier.  Banks.
   Existing law provides uniform rules governing, among other things,
the relationship of banks with their depositors in connection with
the collection and payment of items.
   This bill would  prohibit   provide that
 banks  from using   shall not require but
may use  an individual's mother's maiden name as an account
identifier on accounts established after  January 
 July  1, 2003.  The bill would require banks that have used
an individual's mother's maiden name as an identifier for accounts
established  prior to January   as of July 
1, 2003, to send a written notification  to its current account
holders  indicating that the use of the identifier may pose a
potential risk for identity theft and that the individual may contact
the bank and request that the use of the identifier be discontinued
and that a descriptive word be used.  The bill would require that the
written notification be placed in a prominent location on a mailing
and would authorize it to be sent as a supplement to a current
mailing or by a separate mailing.
   Vote:  majority.  Appropriation:  no.  Fiscal committee:  no.
State-mandated local program:  no.


THE PEOPLE OF THE STATE OF CALIFORNIA DO ENACT AS FOLLOWS:


  SECTION 1.  Section 4105.5 is added to the Commercial Code, to
read:  
   4105.5.  (a) A bank that, prior to January 1, 2003, required an
 
   4105.5.  (a) A bank that as of July 1, 2003, requires the use of
an  individual's mother's maiden name as an identifier for an
individual to access an account shall provide written notification to
its  current  account holders indicating that there is a
potential risk for identity theft if the individual uses his or her
mother's maiden name as an identifier to access  an 
 his or her  account and that the individual may contact
the bank and instruct the bank to discontinue the use of the
individual's mother's maiden name and instead use a descriptive word
as the identifier.
   (b) Accounts established after  January  
July  1, 2003, shall not require  but may use  an
individual's mother's maiden name as an identifier for an individual
who wants to access  an   his or her 
account.
   (c) The written notification under subdivision (a) may be sent to
the individual as a supplement to a current mailing or by a separate
mailing.  The written notification shall be placed in a prominent
location on the mailing.
   (d) For purposes of this section only, "bank" means an institution
engaging in financial activities as described in Section 1843(k),
excluding subpart (4) (B) thereof, of Title 12 of the United States
Code and doing business in this state.  An institution that is not
significantly engaged in financial activities is not a bank for the
purposes of this section.