Compliance Center: CFPB Releases Proposed Amendment to the Annual Privacy Notice Requirement Under GLB Act

Last December, Congress amended the Gramm–Leach–Bliley Act (GLBA) as part of the Fixing America’s Surface Transportation Act (FAST Act). This amendment provided an exemption to the annual privacy notice requirement if credit unions met certain conditions:

  • The credit union only shares nonpublic personal information with non-affiliated third parties in ways that do not trigger a member’s opt-out rights; and
  • The credit union has not changed its privacy policies and practices since its most recent disclosure of them.

While credit unions could follow the exemption as provided under the FAST Act, we have been waiting for the CFPB to update Regulation P to match the GLBA amendment.

The CFPB has released a proposed amendment to update the privacy rule and implement Congress’ exception. In addition, the proposal would eliminate the CFPB’s alternative delivery method for annual privacy notices since any credit union that qualified for the alternative delivery method would qualify for the exception.

Compliance Question of the Week

What is a For Benefit Of (FBO) account? How would I set one up?

A For Benefit Of (FBO) account is form of Totten or In Trust For (ITF) account.  The trustee owns the account and the funds in it.  The other person would be listed as the beneficiary of the account. For example, the titling would like “Jane Does FBO Janet Doe”. Jane would be the owner and Janet would be the beneficiary. Jane would negotiate any checks coming into the account and use those funds for the benefit of Jane.

Because these accounts are set up as informal Totten Trusts, there would not be any trust documentation.

Legal Briefs

National Credit Union Administration (NCUA)

The NCUA released its latest installment of its economic series. The video features information on economic trends, interest rates and Brexit.

Consumer Financial Protection Bureau (CFPB)

The CFPB continued its blog series on auto loans. The newest blog post discusses ways to avoid purchasing a vehicle that is unaffordable or harmful for the borrower.

Federal Reserve Board (FRB)

The FRB posted the minutes from the June Federal Open Market Committee Meeting.

The FRB announced that it is extending the conformance period of the Volker Rule to July 21, 2017.

The FRB published its July issue of FedFocus.

The FRB published its most recent Consumer Credit G.19 report.

Federal Housing Finance Agency (FHFA)

The FHFA released an Update on Implementation of the Single Security and the Common Securitization Platform.

Social Security Administration (SSA)

The SSA announced that it will be reducing the fee of its Social Security Number Verification Service. The fee reduction will be effective October 01, 2016.

Office of Foreign Assets Control (OFAC)

OFAC has updated the SDN list as of July 6, 2016. The last update prior to this was June 30, 2016.

Questions? Contact the Compliance Hotline: 1.800.546.4465, compliance@nwcua.org.

Posted in Compliance News, Federal, NWCUA.