SENIOR SENATE FEDERAL PROPOSAL NO. 6

INTRODUCED BY SENIOR SENATOR JOHN SORENSEN

(COAUTHOR: SENIOR ASSEMBLY MEMBER DOROTHY A. SORENSEN)

LEGISLATIVE COUNSEL'S DIGEST

SFP 6: UNSOLICITED BLANK CHECKS.

UNDER EXISTING FEDERAL LAW, VARIOUS FINANCIAL INSTITUTIONS ARE REGULATED BY CERTAIN FEDERAL AGENCIES AND ARE SUBJECT TO VARIOUS REQUIREMENTS IN THE CONDUCT
OF THEIR BUSINESS.

THIS MEASURE WOULD MEMORIALIZE THE CONGRESS AND THE PRESIDENT TO ENACT LEGISLATION THAT WOULD REGULATE THE DISTRIBUTION BY FINANCIAL INSTITUTIONS OF UNSOLICITED CHECKS WITH PERSONAL IDENTIFICATION AND OTHER INFORMATION ON THEM THAT MAY PLACE THE RECIPIENT AT RISK OF LOSING FUNDS OR PERSONAL IDENTIFY.

VOTE: MAJORITY.

SFP 6: RELATING TO UNSOLICITED BLANK CHECKS

WHEREAS, FINANCIAL INSTITUTIONS ARE CURRENTLY NOT PREVENTED FROM MAILING UNSOLICITED BLANK CHECKS IN THEIR STATEMENTS TO CUSTOMERS; AND

WHEREAS, WHEN THESE CHECKS ARE RECEIVED BY SENIORS THEY ARE OFTEN DISCARDED IN THE TRASH AND MAY OR MAY NOT BE OPENED AS “JUNK MAIL”; AND

WHEREAS, THESE CHECKS MAY HAVE THE NAME AND ADDRESS OF THE CUSTOMER, A “PAY TO THE ORDER OF” WITH THE NAME OF THE CUSTOMER AND AN AMOUNT ALREADY TYPED IN, AND THE MAGNETIC BAR CODE THAT INCLUDES THE CUSTOMER’S ACCOUNT NUMBER; AND

WHEREAS, IF ANY OF THESE CHECKS ARE USED, THERE IS USUALLY A LOW INTEREST RATE AND A FINANCE CHARGE OF $10 MINIMUM AND 3 PERCENT OF THE AMOUNT OF THE CHECK; AND

WHEREAS, THE FINANCIAL INSTITUTIONS THAT SEND THESE CHECKS ARE GENERALLY FROM OUT OF STATE; AND

WHEREAS, THESE CHECKS, WHICH ARE MAILED SO INCONSPICUOUSLY, GREATLY FACILITATE IDENTITY THEFT, AS TOO MUCH INFORMATION IS READILY AVAILABLE ON THEM; AND

WHEREAS, DISCARDED DOCUMENTS OF THIS TYPE MAY BE STOLEN FROM TRASH BINS AND USED BY ANY SCAVENGER OR OTHER UNAUTHORIZED PERSON WHO MAY WISH TO USE THE CHECKS, AND THIS CAN COST THE ORIGINAL RECIPIENT EITHER MONETARY OR IDENTITY LOSS; AND

WHEREAS, THESE CHECKS ARE EITHER ATTACHED TO A STATEMENT OR PROVIDED AS A “BONUS” FROM A FINANCIAL INSTITUTION AND ARE NEVER SOLICITED; AND

WHEREAS, THE FINANCIAL INSTITUTIONS THAT SEND THESE UNSOLICITED BLANK CHECKS ARE USUALLY LOCATED IN SEVERAL STATES AND, THEREFORE, A FEDERAL PROPOSAL IS NEEDED; NOW, THEREFORE, BE IT

RESOLVED, BY THE SENIOR SENATE AND THE SENIOR ASSEMBLY, JOINTLY, THAT THE SENIOR LEGISLATURE OF THE STATE OF CALIFORNIA AT ITS 2008 REGULAR SESSION, A MAJORITY OF THE MEMBERS VOTING THEREFOR, HEREBY PROPOSES THAT THE CONGRESS AND THE PRESIDENT ENACT LEGISLATION THAT WOULD REGULATE THE DISTRIBUTION BY FINANCIAL INSTITUTIONS OF UNSOLICITED CHECKS WITH PERSONAL IDENTIFICATION AND OTHER INFORMATION ON THEM THAT MAY PLACE THE RECIPIENT AT RISK
OF LOSING FUNDS OR PERSONAL IDENTITY; AND BE IT FURTHER

RESOLVED, THAT THE SENIOR LEGISLATURE OF THE STATE OF CALIFORNIA RESPECTFULLY MEMORIALIZES THE CONGRESS AND THE PRESIDENT TO ENACT APPROPRIATE LEGISLATION THAT WOULD ADDRESS THE CONCERNS SET FORTH IN THIS MEASURE; AND BE IT FURTHER

RESOLVED, THAT A COPY OF THIS MEASURE BE TRANSMITTED TO THE PRESIDENT AND VICE PRESIDENT, THE SPEAKER OF THE HOUSE OF REPRESENTATIVES, THE CHAIRPERSONS OF THE HOUSE AND SENATE COMMITTEES ON AGING, THE CHAIRPERSON OF THE HOUSE COMMITTEE ON FINANCIAL SERVICES, THE CHAIRPERSON
OF THE SENATE COMMITTEE ON BANKING, HOUSING, AND URBAN AFFAIRS, THE FEDERAL TRADE COMMISSION, THE COMPTROLLER OF THE CURRENCY, AND TO EACH SENATOR AND REPRESENTATIVE FROM CALIFORNIA IN THE CONGRESS OF THE UNITED STATES.

RN 08 22003

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