House passes privacy notification legislation
AML AND COMPLIANCE NEWS |
On Dec. 14, 2017, the House passed a bill (H.R. 2396) to provide clarification about an organizations’ obligation to send annual privacy notices to consumers. The bill would provide relief from annual privacy notice requirements for vehicle finance companies, provided they meet certain qualifications. However, the bill would not change the relief given to institutions in 2015 under the Fixing America’s Surface Transportation Act (FAST Act).
On Dec. 4, 2015, President Obama signed the FAST Act. The act modified the annual privacy notice requirement under the Gramm-Leach-Biley Act (GLBA). Under the GLBA Privacy Rule, financial institutions must mail an annual privacy notice to their customers who sets forth how they collect, use and disclose those customers’ nonpublic personal information and whether customers may limit such sharing.
The FAST Act changed these requirements, allowing a financial institution to forgo providing an annual privacy notice if (1) the institution only shares personal nonpublic information with nonaffiliated third parties in a manner that does not require an opt-out right be provided to customers and (2) has not changed its information sharing practices since it last provided a privacy notice.