The consumer privacy act
What the Consumer Privacy Act did to amend the Gramm-Leach-Bliley Act
Photo Credit: Rasmus Rasmussen
In August of 2001, The National Consumer Privacy Act was introduced to amend the previous privacy act of the Gramm-Leach-Bliley Act. As Acts are implemented to try to catch up with the evergrowing technologic milestones, new ways of stealing identities and using others information are always coming about. As new Acts are passed, still others are being written to correct them. What was this prior privacy act and how did the new act amend it? What were the consequences of this?
The Gramm-Leach-Bliley Act
Also known as the Financial Modernization Act of 1999, the Gramm-Leach-Bliley Act or "GLB Act" provides for the consumers personal financial privacy. There are three main parts to the act.
The Financial Privacy Rule
The Financial Privacy rule oversees the collection and the disclosure of the personal financial information of consumers by the financial institute.
The Safeguards Rule requires institutes to implement safety regulations to maintain that consumer privacy. It provides for any customer information center whether it be banks, credit reporting agencies, etc.
The Pretexting Provisions protects consumers from the company or individuals that obtain or collect the information of consumer's financial records by false pretense. This is the division that deals with identity theft.
The National Consumer Privacy Act
Introduced on August 2, 2001 by Representative Peter Sessions, a republican from Texas, to amend the Gramm-Leach-Bliley Act and provide for uniform national financial privacy. The bill was H.R. 2730 and also redid the Fair Credit Reporting Act. The goal of the National Consumer Privacy Act was to bring together a uniform act for both Federal and State levels so that there is less confusion and less waste. Where this act doesn't apply is what is called "non public personal information" and will be later addressed. However, the goals of a more uniform approach to federal and state agencies where the object is to create a safer method of handling and securing personal information and financial records.
The National Consumer Privacy Act requires all the agencies to consult and coordinate with each other so that there is a uniform method of reporting. Differing standards are both confusing and allows for discrepancies and therefore the National Consumer Privacy Act will require that anyone working around a banking organization or with consumer financial documents to be held to a higher standard. Another goal of this is to reduce the amount of errors and lost paperwork that may fall into unseemly hands and used to bilk the populous out of millions in identity theft.
The goal is consistency. The implementation of privacy provisions is to make Federal standards to be taken to state levels. It is basically a "one way, every way" type of plan that makes it where the way they do it in Washington D.C. is the same as they do it in Oxford, Alabama. From the national to the smallest town, all methods of handling private consumer records will be the same. The act will still need to be amended and worked upon to catch up on the new technology and the new ways of stealing and using consumer information.