New CFPB Rule Permits Annual Online Privacy Notices
On October 17, 2014, the Consumer Financial Protection Bureau (CFPB) issued a final rule permitting financial institutions to post annual privacy notices online in certain circumstances.
Financial institutions, including credit unions, are required to annually send privacy notices to customers/members. The privacy notices explain how and when the financial institution shares nonpublic personal information about consumers. In addition, if the financial institution wishes to share this information, it is required to provide consumers with the right to opt-out and describe how they can do that.
This new final rule allows financial institutions to provide the privacy notice online if it does not share information triggering an opt-out and they inform consumers on an annual basis about the availability of the privacy notice. In addition, the financial institution must include a notice on regular consumer communication (for example, monthly credit card statements) informing consumers that the annual privacy notice is online and they can request a paper copy.
CLA’s financial institution regulatory compliance team assists banks and credit unions nationwide in establishing regulatory compliance programs, conducting compliance testing, and training staff on regulations. Justin Robinson is a member of CLA’s regulatory compliance team and can be reached at justin.robinson@CLAconnect.com.
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