The Consumer Financial Protection Bureau Friday issued a proposed rule to implement legislation that would exempt financial institutions meeting certain requirements from sending annual privacy notices. CUNA heavily advocated for the Eliminate Privacy Notice Confusion Act (H.R. 601), which was eventually signed into law alongside other regulatory relief provisions as part of the Fixing America’s Surface Transportation (FAST) Act.
Under the Gramm-Leach-Bliley Act (GLBA), financial institutions are generally required to send annual privacy notices to consumers. The FAST Act amended the GLBA, allowing institutions to be exempted from this requirement if it limits its sharing of consumer information so that the consumer does not have the right to opt out and has not changed its privacy notice from the one previously delivered.
The CFPB’s proposal would implement this legislation, as well as establish deadlines for institutions resuming annual privacy notices if their practices change and cease to qualify for the exemption.
The proposal will be open for comment for 30 days after its publication in the Federal Register, which is expected in the coming days.
After the FAST Act was signed into law, CUNA sought clarifications from the NCUA on its implementation, and the agency responded in January with a letter to credit unions.
The letter stated that federal credit union examiners are on notice that credit unions meeting requirements were no longer required to send annual privacy notices.