Security. Financial institutions must develop, implement, and maintain a comprehensive information security program. 16 C.F.R. § 314.3(a). Preemption. The GLBA does not preempt state laws that may provide greater privacy protection to consumers. 15 U.S.C. § 6807(b). GLBA Privacy and Safeguards Rules. The GLBA regulations consist of a “Privacy Rule” (requiring disclosure to consumers about the use and dissemination of their nonpublic personal financial information) and a “Safeguards Rule” (requiring safeguarding any financial information obtained from an individual that is not publicly available). Subject to certain exceptions, financial institutions are also prohibited from disclosing any “nonpublic personal information” to unrelated third parties without first giving customers the ability to opt-out of the sharing. Consumer Distinguished from Customer. Nonpublic personal information under GLBA is any “personally identifiable financial information” that is not publicly available and is capable of personally identifying a consumer or customer. A consumer is anyone who has obtained a financial product or service but does not necessarily have an ongoing relationship with the financial institution and a customer is a person with an ongoing relationship with the financial institution. GLBA Requirements. The GLBA requires the financial institution to: 1) notify its customers about its information-sharing practices and provide customers with a right to opt out if they do not want their information shared with certain unaffiliated third parties (GLBA Financial Privacy Rule); 2) implement a risk - based written security program to protect nonpublic personal information from unauthorized disclosure (GLBA Safeguards Rule); and 3) provide notice of its information sharing to consumers in some situations. GLBA Notice and Disclosure Requirements. A customer is entitled to receive the financial institution’s privacy notice both when the relationship is created and annually thereafter. After the initial disclosure,
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