To All Depository Institutions and Others Concerned in the Second Federal Reserve District:
In a joint press release, eight federal regulators announced an advance notice of proposed rulemaking (ANPR) requesting public comment on ways to improve privacy notices financial institutions provide to consumers under the Gramm-Leach-Bliley Act (GLB Act).
The ANPR describes various approaches that the agencies could pursue to allow or require financial institutions to provide alternative types of privacy notices that would be more readable and useful to consumers. It also seeks comment on whether differences between federal and state laws pose any special issues for developing a short privacy notice.
Section 503 of the GLB Act requires financial institutions to provide a notice to each customer that describes the institutions' policies and practices regarding disclosure to third parties of nonpublic personal information. In 2000, the agencies published consistent final regulations that implement these provisions, including sample clauses that institutions may use in privacy notices. However, the regulations do not prescribe any specific format or standardized wording for privacy notices.
The ANPR was jointly developed by the Board of Governors of the Federal Reserve System, Commodity Futures Trading Commission, Federal Deposit Insurance Corporation, Federal Trade Commission, National Credit Union Administration, Office of the Comptroller of the Currency, Office of Thrift Supervision, and Securities and Exchange Commission.
The agencies do not propose the adoption of any specific action at this time to improve privacy notices. Instead, they request input on what approaches would be most useful to consumers while taking into consideration the burden on financial institutions. Agencies will evaluate the public comment on the ANPR with a view toward developing proposals for appropriate interpretations or amendments to their respective regulations.
Written comment may be submitted within 90 days of the publication of the ANPR in the Federal Register.
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