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Tuesday, May 13, 2014

Sens. Brown, Moran Call for Senate to Pass Privacy Notice Bill

After the Consumer Financial Protection Bureau last week proposed easing banks’ annual privacy notice requirements under the Gramm-Leach-Bliley Act (GLBA), Sens. Sherrod Brown (D-Ohio) and Jerry Moran (R-Kan.) called on the Senate to pass the bipartisan, ABA-supported Privacy Notice Modernization Act, which achieves a similar result.

“Progress by the CFPB and the House of Representatives demonstrates broad support for the principles of the Privacy Notice Modernization Act,” Moran said. “I urge my Senate colleagues to support swift passage of this bill so banks and credit unions can better serve their customers and make privacy notices readily available without filling mailboxes with duplicative information.”

The bill would allow banks that share nonpublic personal information about their customers with nonaffiliated third parties, in a manner(s) that does not require an opt-out, to forego mailing an annual privacy notice unless the privacy policy has changed. Instead, banks that choose not to mail their privacy notices would be required to make their privacy notices available online.

This bill is similar to the CFPB’s proposed rule in that both permit posting GLBA privacy notice online, but the CFPB’s rule specifically requires Fair Credit Reporting Act opt-out notices for the sharing and use of information with affiliates for marketing purposes to be provided separately, while the bill is silent on this issue. The CFPB’s proposed rule would also require banks posting their privacy notices online to notify customers annually that the privacy notice is available online or by calling a toll-free number.

Read more.

Read ABA's letter in support.