PRIVACY PROVISIONS FINALLY FINALIZED

On August 10, 2018 the Bureau of Consumer Financial Protection (CFPB) completed the nearly three year process of issuing relatively minor amendments to implement legislation that allows financial institutions that meet certain requirements to be exempt from sending annual privacy notices to their customers. The Gramm-Leach-Bliley Act (GLBA) generally requires that financial institutions send annual privacy notices to customers.

In December 2015, Congress amended the GLBA as part of the Fixing America’s Surface Transportation Act (FAST Act). This amendment to the GLBA provides financial institutions that meet certain conditions an exemption to the requirement under the GLBA to deliver an annual privacy notice. A financial institution can use the annual notice exception if it limits its sharing of customer information so that the customer does not have the right to opt out, and has not changed its privacy notice from the one previously delivered to its customer.

The final rule implements this legislation and establishes deadlines for institutions resuming annual privacy notices if their practices change and they therefore cease to qualify for the exemption.

The rule is effective 30 days after publication in the Federal Register, which is expected soon. A copy of the 55-page final rule is available at:  https://files.consumerfinance.gov/f/documents/bcfp_glba-privacy-notices_final-rule_amendment_2018-08.pdf

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