The "Fixing America's Surface Transportation Act" or "FAST Act," signed into law by President Obama on December 4, 2015, contained an amendment to the privacy policy sections of the Gramm-Leach-Bliley Act (the "GLBA").[1] Among other things, the GLBA and its various implementing rules and regulations require "financial institutions" - including registered investment advisers and private funds [2]- to provide notice to individuals[3] regarding the financial institution's privacy policies and procedures on an annual basis (in addition to upon establishing a relationship with the individual).

The amendment provides an exception to the annual delivery requirement for any financial institution that satisfies the following two criteria:

  • the financial institution does not share nonpublic personal information with nonaffiliated third parties (other than as permitted under certain enumerated exceptions, e.g., to service providers who perform services on behalf of the financial institution, or as necessary to administer a transaction requested or authorized by an individual); and  
  • the financial institution has not changed its privacy policies and practices from the policies and practices that were disclosed in the most recent privacy notice sent to individuals. 

Investment advisers and private funds satisfying both criteria are no longer required to provide privacy notices to individual investors on an annual basis. Importantly, however, investment advisers and private funds must still provide an initial privacy policy notice to an individual investor at the time of establishing the relationship with the investor, i.e., in subscription documents or other similar offering documents.

The amendment to the GLBA became effective on December 4, 2015.