Financial Privacy

The Gramm-Leach-Bliley Act: The Financial Privacy Rule

The Commission's Financial Privacy Rule ("Privacy Rule") was issued to satisfy one of the three main requirements of the Gramm-Leach-Bliley Act (the others: Safeguards and Pretexting). The Privacy Rule applies to “financial institutions.” Under the FTC's jurisdiction, such institutions include nonbank companies that engage in a wide array of "financial activities" such as: lending; brokering or servicing any type of consumer loan; transferring or safeguarding money; preparing individual tax returns; providing financial advice or credit counseling; providing residential real estate settlement services; collecting consumer debts; and various other activities. For a list of the covered financial activities, please visit the Laws and Rules section of this page.

The Financial Privacy Rule requires financial institutions to give their customers privacy notices that explain the financial institution’s information collection and sharing practices. In turn, customers have the right to limit some sharing of their information. Also, financial institutions and other companies that receive personal financial information from a financial institution may be limited in their ability to use that information.

The Federal Trade Commission is one of eight federal agencies that, along with the states, are responsible for developing a consistent regulatory framework to administer and enforce the Financial Privacy Rule. In December 2003, the eight federal agencies issued an Advance Notice of Public Rulemaking to consider the development of alternative forms of privacy notices for consumers, soliciting public comments on the feasibility, design, and content for a short notice and requesting applicable research.

The FTC, FRB, OCC, FDIC, SEC, and NCUA are currently engaged in an interagency notice research project, to develop through consumer testing alternative forms of privacy notices for consumers. The agencies anticipate that work on the project will continue through the end of 2005.”

For a summary overview of the Financial Privacy Rule, be sure to see In Brief: The Financial Privacy Requirements of the Gramm-Leach-Bliley Act.

You will find the following information on the Financial Privacy Rule here: the laws and regulations, business education materials and staff guidance on specific technical issues, consumer education materials and information about GLB Workshops. In addition, you will find information on GLB Act preemption determination requests submitted to the Commission.