Promoting both the security of customer information as well as the ability of banks to serve their customers.
ABA supports efforts to protect the nonpublic, personal information privacy of financial service customers. ABA supports public policies that properly balance the legitimate information sharing needs of a financial institution—to provide customers with the services they need—with the obligation to protect customer information. ABA supports providing a flexible format for achieving clarity in disclosing privacy policies.
ABA strongly discourages Congress and state governments from placing additional restrictions on the information sharing activities of financial institutions that would interfere with the ability of banks to provide services to customers and meet customer needs. Some current requirements already impose costs and obligations that have little relationship to customer needs or desires. For example, ABA urges Congress to remove the annual privacy notice required even when a bank does not share information with non-affiliate entities beyond the regulatory exceptions.
ABA applies a three-pronged measure to ensure that legislative or regulatory action relating to customer information privacy is appropriate. This test evaluates whether the proposal: (1) keeps the banking industry on a level playing field with other similarly situated industries; (2) gives financial institutions the necessary flexibility to conduct their current and future information sharing activities without undue interference; and (3) properly balances the legitimate information sharing needs of a financial institution to serve our customers with the goal of maintaining customer information privacy and security.
Customer information sharing, use, and security are primarily governed by regulations and guidance implementing the Gramm-Leach-Bliley Act and the Fair Credit Reporting Act, as recently amended by the Fair and Accurate Credit Transactions Act (FACT Act). ABA has used its three-pronged measure to help improve proposed rules under these laws, as evidenced by its advocacy with respect to the recent ID Theft Red Flag rule, the Affiliate Marketing Rule, and proposals to improve furnisher accuracy when reporting to credit bureaus and to simplify privacy notices.
Contact for further information: Rob Rowe (202) 663-5029; Nessa Feddis (202) 663-5433.