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Gramm-Leach-Bliley Act
In 1999 the United States Congress passed the Gramm-Leach-Bliley Act also known as the Gramm-Leach-Bliley Financial Services Modernization Act. Primarily the legislation served to open up competition among securities companies, insurance companies and banks, but among its provisions, Gramm-Leach-Bliley also requires financial institutions to provide their customers with annual notices of the privacy policy of the institution.
The law provides for a number of restrictions on the disclosure of personal information to third party entities and prohibits the aforementioned institutions from obtaining information from their customers under false pretenses.
The privacy notices provided to customers must include an explanation of what information the company gathers, where the information is shared, and how the information is protected. This privacy notice must also be given to customers prior to the conclusion of an agreement for services. Customers have the option under the provisions of the Fair Crediting Reporting Act to "opt out" or to decline to have their information shared with third parties.
More terms explained
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