Following a recent CFPB proposal on privacy disclosures, U.S. Sens. Sherrod Brown (D-Ohio) and Jerry Moran (R-Kan.) renewed their push for legislation that would streamline financial privacy notifications.
The Privacy Notice Modernization Act, which has 63 bipartisan cosponsors, would exempt institutions that do not publicly share customer information from delivering annual privacy notices unless there has been a change to the privacy policy. However, the existing privacy policy would still be available to consumers on the institution's website.
The Gramm-Leach-Bliley Act currently requires financial institutions to mail a copy of their information-collection and sharing policy to customers annually. The senators noted the disclosures are often long, cluttered and confusing for consumers. They also said the requirement has become expensive for small institutions like community banks and credit unions.
"Consumers don't need to be flooded with duplicative and confusing information, we need to make disclosures easier to understand," Brown said. "The CFPB deserves credit for moving forward with its proposal. But our commonsense bill would further reduce burdensome and unnecessary paperwork – that burden consumers and community banks and credit unions alike – and ensure that provide disclosures are timely, clear, and concise."
CUNA, NAFCU, the American Bankers Association and the Independent Community Bankers of America endorsed the legislation.
"Progress by the CFPB and the House of Representatives demonstrates broad support for the principles of the Privacy Notice Modernization Act," Moran said. "I urge my Senate colleagues to support swift passage of this bill so banks and credit unions can better serve their customers and make privacy notices readily available without filling mailboxes with duplicative information."
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