July 5, 2022
On June 23, 2022, a U.S. Representative on the House Financial Services Committee, released a discussion draft of new legislation to modernize financial data privacy laws (“Draft”) and provide consumers more control over how their personal information is collected and used. The legislation, if passed, would amend the Gramm-Leach-Bliley Act (“GLBA”) to better align with the evolution of technology. In this update, we will present the purpose and key pillars of the Draft.
Modernizes GLBA using a Technology-Agnostic Approach.
The consumer protection mechanisms contained in the Draft will be adapted to future innovation and new technologies. Specifically:
Consumers Control Over Personal Information.
The Draft recognizes the need for consumers to control how financial institutions and third parties are using their personal information. The Draft ensures consumers have the right to opt-out of the data collection and request deletion of their personal information at any time. Moreover, the Draft expands the definition of “personally identifiable financial information” to include “information that identifies, relates to, describes, is reasonably capable of being associated with, or could reasonably be linked, directly or indirectly, with a particular consumer.”
Minimizes Data Collection.
The Draft protects consumers against misuse or overuse of their nonpublic personal information. Specifically:
Accessible and transparent policies.
If the Draft will be approved, it will provide consistency across the U.S. regarding how financial institutions collect and use personal information. The Draft will create a national standard for data collection, which will provide certainty to both consumers and financial entities that handle their financial data.
This document is intended to provide only a general background regarding this matter. This document should not be regarded as setting out binding legal advice, but rather a practical overview that is based on our understanding. APM &Co. is not licensed to practice law outside of Israel.
For more information we will be happy to assist.
APM Privacy and Cyber Team.