On December 1, 2009 the federal agencies responsible for administering the Graham-Leach-Bliley Act (“GLBA”) and the Fair Credit Reporting Act (“FCRA”) issued revised regulations that financial institutions, including auto dealerships, may use to meet the new privacy notice requirements under the Acts. The focus of the revised regulation is on a new Model Form that will make it easier for consumers to understand how financial institutions collect and share information about consumers. The regulation provides a safe harbor provision for institutions On December 1, 2009 the federal agencies responsible for administering the Graham-Leach-Bliley Act (“GLBA”) and the Fair Credit Reporting Act (“FCRA”) issued revised regulations that financial institutions, including auto dealerships, may use to meet the new privacy notice requirements under the Acts. The focus of the revised regulation is on a new Model Form that will make it easier for consumers to understand how financial institutions collect and share information about consumers. The regulation provides a safe harbor provision for institutions that use the model form exactly as written.
Use of the new model form is not required. Dealers may develop their own updated Privacy Notice but they must ensure that their notices comply with all of the requirements of GLBA and the Privacy Rule. The benefit of the using the Model Privacy Notice is that, if completed as required by the instructions and delivered properly; it will provide a safe harbor for compliance. In order to take advantage of the safe harbor protection, dealers must begin using the new model form by December 31, 2010.
The Privacy Rule applies to car dealers who:
• Extend credit to someone (for example, through a retail installment contract) in connection with the purchase of a car for personal, family, or household use;
• Arrange for someone to finance or lease a car for personal, family, or household use; or
• Provide financial advice or counseling to individuals.
Fortunately, compliance should be reasonably easy. The agencies have developed a Privacy Notice Online Form Builder to assist in creating your new notice. Following are links to the Form Builders:
http://www.federalreserve.gov/newsevents/press/bcreg/privacy_notice_instructions.pdf
http://www.ftc.gov/privacy/privacyinitiatives/PrivacyModelForm.pdf
