Updated November 2013
The Gramm-Leach-Bliley Act (P.L.
106-102), enacted in 1999, requires financial institutions and a wide variety
of other businesses to issue privacy disclosure notices to consumers that
detail the institution's privacy policies if it shares customers' non-public
personal information with affiliates or third parties. The law also requires
telling existing and potential customers of their right to opt out of sharing
non-public personal information with third parties. Such disclosures must take
place when a customer relationship is first established and annually in paper
form as long as the relationship continues even if no changes have occurred.
This legislation would help eliminate the confusion by exempting institutions
whose policies have not changed from this outdated requirement.
The privacy notice, for most
institutions, is readily available for view online, as well as available at
branch locations for consumers to acquire if they so wish. The exception will
allow credit unions to focus their resources on providing low cost financial
availability. The staff resources and money wasted to send the required notice
to millions of credit union members every year are resources that could better
serve them in the form of loans or interest payments.
As many institutions and consumers are earnestly attempting to "go
green" the current requirement stands in stark contrast. The exception
would save credit unions valuable staff resources, lower the cost of financial
services, and reverse the negative environmental impact caused by such a
requirement, while not harming consumers.
At the end of the 112th Congress the House passed legislation (H.R. 5817) by
unanimous consent that would have eliminated the unnecessary, redundant and
- Do not share information with non-affiliated third
While the Senate did not act on this
bill, it was re-introduced in the House at the beginning of the 113th Congress
by Reps. Blaine Luetkemeyer (R-MO) and Brad Sherman (D-CA) as the Eliminate
Privacy Notice Confusion Act (H.R. 749).
On March 12, 2013 the House passed H.R. 749 by unanimous consent. The
same day, NAFCU sent a letter to the Senate urging immediate action and is
lobbying to make sure that the legislation is addressed as soon as possible.
On March 21, 2013 Senators Sherrod Brown (D-OH) and Jerry Moran (R-KS)
introduced the Privacy Notice Modernization Act, S. 635, a substantially
similar version of the House bill. The bill currently has 41 bipartisan cosponsors
and NAFCU lobbyists are working to gain momentum on the legislation.
NAFCU will continue to monitor the legislation and provide updates as they
Annual Privacy Disclosure Notices Policy Letters
10-29-2013 NAFCU letter urging action on S. 635
03-12-2013 NAFCU urging action on H.R. 749
12-12-12 NAFCU letter to Senate urging action on H.R. 5817
12-3-12 Boehner-Pelosi letter in support of H.R. 5817