Stop! - Don't Throw Away any 'Junk Mail' From Your Bank

The subject of privacy is receiving considerable public attention today. New federal laws have been passed to help you understand how banks, credit card companies and other financial service providers use and protect your information.

If you have not already received this notice, be on the look out for your "Opt Out" option from your lending institutions.

The Gramm-Leach-Bliley Financial Moderation Act of 1999, which limits the amount of personal information that financial institutions, insurance companies, banks and more can share with others, is causing financial institutions to contact their account holders.

Everyone in the U.S. who has an account with a bank, credit union, savings and loan or a mortgage company, or who has an insurance policy or an investment account, can expect to receive notices that will give him or her the option to limit the amount of personal information those companies can share or sell.

Below is a summary of your rights under this ACT and what your financial institution is required to do:

  1. Tell customers what kinds of information they collect and the types of businesses to which they sell or give that information.
  2. If the institution intends to sell or give account holder information to a company outside its corporate family, the institution has to give the account holder a way to object to this practice.
  3. The institution has to tell account holders how it protects the confidentiality of the account holder information.

There is no regulated format the institutions have to follow in communication with account holders, but the word privacy should be fairly prominent. Don't fling the notice into the wastebasket unless you don't mind being contacted by companies trying to sell you things.

Here's what it all boils down to:

  1. Gramm-Leach-Bliley allows you to stop institutions from selling or sharing your non-public personal information with nonaffiliated companies.
  2. The Fair Credit Reporting Act allows you to stop institutions from selling or sharing your credit-worthiness information with affiliated companies.

If you realize you've tossed a notice out by mistake or have not received your notice by July 1, 2001 call your institution and tell them you want to opt out. Even if you don't decide to opt out now, if you change your mind later, call your financial institution.

Note: AccountingWEB recently ran an article about "tips to help you if your identity is stolen." Check this out for some helpful tips on how to secure your privacy.

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