NEW MODEL PRIVACY FORMS REQUIRED TO RELY ON SAFE HARBOR
The new model privacy forms adopted by the federal banking agencies and the Federal Trade Commission (the Agencies) may be relied on by financial institutions as a safe harbor to provide the disclosures required by Title V of the Gramm-Leach-Bliley Act (GLB Act). The model privacy form is two pages and uses a box format.
The first page of the final model form has five parts: (1) a title; (2) an introductory section intended to help the consumer understand the purpose of the notice; (3) a disclosure table that describes the types of sharing possible for all financial institutions, which of those types of sharing the institution providing the notice actually engages in, and whether the consumer can opt out of any of the institution’s sharing; (4) if applicable, information for the consumer on how to opt out; and (5) the institution’s customer service contact information.
The second page provides additional explanatory information required by the GLB Act. Supplemental information about the financial institution and what it does with personal information is found at the top of the second page, with key definitions below. Space is provided at the bottom of the second page for financial institutions to discuss state and/or international privacy laws and include an acknowledgement of receipt.
The Agencies are eliminating the sample clauses and related safe harbor from the current privacy rules following a transition period. Financial institutions are no longer permitted to rely on the sample clause safe harbor for notices that are delivered to consumers after January 1, 2011. The sample clauses will be removed entirely from the Agencies’ rules on January 1, 2012. Financial institutions seeking to rely on the safe harbor through use of the model form may modify it only as described in the instructions in the rules. In addition, institutions may continue to use other types of notices that vary from the model form, including notices that consist of the sample clauses, so long as these notices comply with GLBA and the Agencies’ privacy rules. However, a financial institution that uses a form that is not substantially similar to the model form risks losing the safe harbor. Please let us know if you have any question regarding the new model privacy notice or other privacy issues.
- Elizabeth Anstaett and