On November 17, eight federal regulatory agencies, including the FTC, FDIC, and Federal Reserve, released a final privacy rule and model form (collectively, the “privacy rule”) under the Gramm-Leach-Bliley Act. The model form is intended to make it easier for consumers to understand how financial institutions collect and share information about consumers, and give consumers the right to opt out of certain information-sharing practices. Although financial institutions are not required to use the model form, it does provide them with a safe harbor for compliance with the disclosure requirements of the privacy rule. The rule also eliminates, after a transition period, the safe harbor provided by the agencies’ sample notices in the prior versions of the privacy rule. Most provisions of the privacy rule take effect on January 1, 2010.
TIP: If you are a financial institution subject to the Gramm-Leach-Bliley Act, you should review your consumer privacy disclosure forms and practices to determine whether they comply with the new privacy rule.