My turn: State’s ‘secret deal’ a disservice to Alaskans

Posted: Monday, May 03, 2010

In February, tens of thousands of hard-working public employees received letters informing them that the State of Alaska and its contractors had lost personal information, thereby putting them at risk of becoming victims of identity theft.

Furthermore, without any prior notice to or discussion with those at risk of massive fraud, the State and its contractors cut a secret deal limiting their liability, despite carrying out their responsibilities in such a derelict manner.

I wrote to the State that I do not accept the secret settlement the State made with the involved parties, and that I objected to the settlement for a number of reasons.

As a member of the affected class, I was not: informed of the serious breach of personal security as soon as it was known to have occurred; informed of my rights; or given a chance to review the proposed settlement before it was approved by the State.

The State’s action is tantamount to creating what in legal circles is called a “contract of adhesion,” as I and 77,000 other Alaskans were essentially presented with a “deal” on a “take it or leave it basis” by the State without having any meaningful opportunity to negotiate terms that would better protect our interests.

This action of the State and its agents has been exacerbated by the requirement that each of the 77,000 Alaskans, many of whom are senior citizens, was made responsible for responding to the letter received from the State, with no proactive offer of individual assistance from the State or its contractor.

It appears that we have a new definition of personal responsibility: No persons who were ultimately responsible for the lack of proper security precautions loses their job, but 77,000 Alaskan victims might lose their identities. In other words, “the buck does not stop here” seems to be the motto of those who cut the secret deal.

Part of the secret settlement provides for identity theft insurance. Perhaps the secrecy in part was to hide the fact that this insurance is underwritten by a subsidiary of the American International Group (AIG), which was bailed out during the Bush administration in 2008, when it had a liquidity crisis. Unlike those responsible for the secret settlement, I do not have confidence in that particular company’s financial strength or integrity.

Finally, I was shocked by the secrecy of the settlement itself. I would have expected the current governor to operate in an “open and transparent” manner, especially in a matter involving tens of thousands of hard working public employees.

I am disappointed to find that not to be the case. I suspect that if a private corporation attempted to do what the State of Alaska did in a matter involving potentially grave financial harm to tens of thousands of Alaskans, the State itself would probably have sued to nullify the agreement.

• Bob Weinstein is a former mayor of Ketchikan and still resides there.

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