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Summary:
Title V of the Gramm-Leach-Bliley Act of 1999 (P.L. 106-102, H.Rept. 106-434) requires financial institutions to provide their customers with notice of their privacy policies, including those relating to sharing of customer information with affiliated entities. It prohibits sharing personally identifiable customer information with non-affiliated third parties and prohibits financial institutions from providing account numbers to non-affiliated third parties for marketing purposes. It requires financial institutions to safeguard the security and confidentiality of customer information. Finally, it delegates rulemaking and enforcement authority to the various functional regulators of financial institutions, that is, the federal banking and security regulators, the Federal Trade Commission, and state insurance regulators. Gramm-Leach-Bliley was enacted in the face of very little federal law directly regulating customer financial data held by financial services providers. Privacy concerns have increasingly been raised by consumers and may be reflected in various legislative developments. The Gramm-Leach-Bliley legislation includes prohibitions on ''pretext calling,'' obtaining financial institution customer information by false pretenses. It also includes a provision that would require financial institutions to permit customers to opt out of sharing, with nonaffiliated third parties, nonpublic personally identifiable information. A provision restricting insurance company disclosure of customer medical, health, and genetic information was deleted in Conference. This report will be updated on the basis of floor action in either House addressing either an amendment to Title V of Gramm-Leach-Bliley or the question of privacy protection for financial institution customer information.
