Written by Eliott C. Ponte, Regulatory Compliance Counsel
Regular readers of the NAFCU compliance blog will note that we have been covering the recent change to annual privacy notices since the enactment of the “Fixing America’s Surface Transportation Act,” or the “FAST Act.” As noted in our December 30th and December 23rd blogs NAFCU was pleased that the Gramm-Leach-Bliley Act (GLBA) was amended, as NAFCU had long advocated for regulatory relief because our members have consistently communicated that their members find these disclosures more confusing than helpful. Upon the enactment of the FAST Act, NAFCU President and CEO Dan Berger wrote Director Cordray urging the Bureau to “act swiftly to implement these statutory changes and clarify the controlling law.” The CFPB responded a few days later by stating that financial institutions are not expected to comply with the regulatory requirements that were superseded by the FAST Act.
On Monday, NCUA chimed in on the recent change by issuing a letter to Federally Insured Credit Unions further clarifying the new expectations under the amended GLBA. Most notably, the NCUA stated that it has instructed credit union examiners to only expect annual privacy notices to be provided if a credit union does not meet the new annual notice requirements. Furthermore, the NCUA shared what examiners will be looking for when determining if the credit union is required to send annual privacy notices. In relevant part, the NCUA letter states:
“Dear Board of Directors and Chief Executive Officer:
Based on the amendment, your credit union need not provide an annual privacy notice if:
- Your policies and practices have not changed since your credit union provided its most recent privacy notice to consumers; and
- You share nonpublic personal information with nonaffiliated third parties only in accordance with requirements for certain existing GLBA exceptions, including those related to:
- Performing services for, or functions on behalf of, the credit union, pursuant to a joint marketing agreement;
- Administering, servicing, or processing a transaction a consumer requests or authorizes; maintaining or servicing certain consumer accounts; or performing securitizations, secondary market sales, or similar transactions; or
- Other specified operational and legal purposes, including disclosure with the consumer’s consent or at the consumer’s direction and disclosure to protect the confidentiality and security of records related to the consumer, service, product, or transaction.
NCUA examiners have been notified that if your credit union meets the applicable requirements, you need not send annual privacy notices unless and until your credit union no longer meets those requirements. NCUA examiners will only expect annual privacy notices to be provided if your credit union does not meet the new requirements described in this letter.
NCUA staff will consult with Consumer Financial Protection Bureau staff as CFPB works to implement the FAST Act’s amendment to GLBA and address interactions with other laws, such as the Fair Credit Reporting Act.”
16-CU-03 (emphasis added). As consistent with our prior blog posts, credit unions that meet the outlined criteria can take advantage of the newly amended GLBA exception and not provide annual privacy statements to their members. Credit unions that plan on taking advantage of the newly amended GLBA should review the FAST Act to ensure their credit union qualifies for the exception.
The full letter can be found on the NCUA’s website.
Dog Meets Snow; Cat Doesn’t Care About Snow
This weekend was a very exciting time for my puppy, Macie, She experience snow for the first time. It was an exciting experience for her. I share her experience with you in the video below (if you cannot see the embedded video, click here):
I thought she would miss the warm weather of Puerto Rico after the blizzard hit, but it looks like she found bliss in our cold climate.
Miles, my youngest cat, didn't care about snow or the blizzard. In fact, the only thing my cat cares about is hot radiators.
In my house, once we turn on the heat, Miles glues himself to our radiators.
This is him after we removed all of our holiday cards. I am really not sure he moves. Oh to be a cat!