Federal legislation could set data security guidelines

A recent informal poll by the National Association of REALTORS®’ (NAR) legal department found that 83 percent of brokers didn’t know if their state had a law governing how real estate brokerages must handle consumers’ personal information.

Pennsylvania, along with 45 other states, has passed legislation regarding the security of personal information. Two laws became effective in the commonwealth in 2006: the Breach of Personal Information Notification Act (BPINA), which regulates the collection and security of certain personal information and the Privacy of Social Security Number Act, which makes it a crime to disclose a person’s social security number in certain ways.

But soon, state laws may not be all REALTORS® have to worry about. Earlier this year, Rep. Bobby Rush (D-IL) introduced the BEST PRACTICES Act (H.R. 5777), which would establish federal guidelines for consumer data privacy.  Although there’s no guarantee that this particular bill will become law, the issues of consumer privacy and data security are pretty hot in Washington and it’s quite possible that there will soon be federal legislation to deal with.

In an effort to get ahead of this potential legislation, NAR rolled out a new Data Security and Privacy Toolkit at the NAR Legal Seminar at the annual NAR Convention earlier this month in New Orleans.  The toolkit is heavily based on resources produced by the Federal Trade Commission but with considerable customization for the real estate field.  Aside from focusing on real estate-specific procedures, the toolkit contains some sample policies currently in use by NAR or state real estate associations.

Take a look at the toolkit to remind yourself of some of the practices you may need to implement or change.  You can also review some other privacy resources from NAR — but remember that this is a general resource. Nothing here is customized for Pennsylvania, so you (and your brokerage counsel) will need to be sure that whatever you do fully complies with Pennsylvania law.

You can find out more about these state laws on the Data Security Page of the PAR Issues Resource Center.  Available resources include copies of each law, along with detailed Q&As for each.  There is also a broker’s guide, sample brokerage policy (PAR members only) and a number of links to resources provided by the Federal Trade Commission.