Treasury to Study Financial Institutions’ Information Sharing Practices

Washington, DC, March 14, 2002 - The Secretary of the Treasury has issued a release regarding a study of information sharing practices among financial institutions and their affiliates that the Secretary is conducting in conjunction with the federal functional regulatory agencies and the Federal Trade Commission. Comments on the release must be submitted to the Secretary on or before April 1, 2002.

The Treasury’s study was mandated by the Gramm-Leach-Bliley Act and must address the following issues:

• The purposes for the sharing of confidential customer information with affiliates or with non-affiliated third parties;
• The extent and adequacy of securities protections for such information;
• The potential risks for customer privacy of such sharing of information;
• The potential benefits for financial institutions and affiliates and for customers of such sharing of information;
• The adequacy of existing laws to protect customer privacy;
• The adequacy of financial institution privacy policy and privacy rights disclosure under existing law;
• The feasibility of different approaches, including opt out and opt in, to permit customers to direct that confidential information not be shared with affiliates and nonaffiliated third parties; and
• The feasibility of restricting the sharing of information for specific uses or of permitting customers to direct the uses for which information may be shared.

To assist the Treasury in completing this study, the release seeks comments on certain issues as well as responses to specific questions relating to each of the above issues. Upon completion of the study, a report will be submitted to Congress of the study’s findings and conclusions, as well as any recommendations for legislative or administrative action as may be appropriate.

Recently, the Treasury's Financial Crimes Enforcement Network proposed rules that provide for the sharing of information—between the government and financial institutions and among financial institutions—for the purpose of combating terrorism and money laundering.