[Congressional Record Volume 158, Number 160 (Wednesday, December 12, 2012)]
[House]
[Pages H6723-H6724]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]
ELIMINATE PRIVACY NOTICE CONFUSION ACT
Mrs. CAPITO. Mr. Speaker, I move to suspend the rules and pass the
bill (H.R. 5817) to amend the Gramm-Leach-Bliley Act to provide an
exception to the annual privacy notice requirement, as amended.
The Clerk read the title of the bill.
The text of the bill is as follows:
H.R. 5817
Be it enacted by the Senate and House of Representatives of
the United States of America in Congress assembled,
SECTION 1. SHORT TITLE.
This Act may be cited as the ``Eliminate Privacy Notice
Confusion Act''.
SEC. 2. EXCEPTION TO ANNUAL PRIVACY NOTICE REQUIREMENT UNDER
THE GRAMM-LEACH-BLILEY ACT.
Section 503 of the Gramm-Leach-Bliley Act (15 U.S.C. 6803)
is amended by adding at the end the following:
``(f) Exception to Annual Notice Requirement.--A financial
institution that--
``(1) provides nonpublic personal information only in
accordance with the provisions of subsection (b)(2) or (e) of
section 502 or regulations prescribed under section 504(b),
and
``(2) has not changed its policies and practices with
regard to disclosing nonpublic personal information from the
policies and practices that were disclosed in the most recent
disclosure sent to consumers in accordance with this
subsection,
shall not be required to provide an annual disclosure under
this subsection until such time as the financial institution
fails to comply with any criteria described in paragraph (1)
or (2).''.
The SPEAKER pro tempore. Pursuant to the rule, the gentlewoman from
West Virginia (Mrs. Capito) and the gentleman from California (Mr.
Sherman) each will control 20 minutes.
The Chair recognizes the gentlewoman from West Virginia.
General Leave
Mrs. CAPITO. Mr. Speaker, I ask unanimous consent that all Members
may have 5 legislative days in which to revise and extend their remarks
and to add extraneous materials on this bill.
The SPEAKER pro tempore. Is there objection to the request of the
gentlewoman from West Virginia?
There was no objection.
Mrs. CAPITO. Mr. Speaker, I yield myself such time as I may consume.
The amended version of H.R. 5817 represents compromise language that
addresses concerns raised by some Members about the last section of the
bill, which provided certain regulatory relief to State-licensed
financial institutions. The bill before the House today is
substantially the same as the legislation that passed the House by
voice vote in April 2010, and we actually debated this bill a week ago.
I would like to thank the sponsors of H.R. 5817, Mr. Luetkemeyer, Mr.
Sherman, Mrs. Maloney, Mr. Capuano, and Mr. Frank, for agreeing to this
compromise language.
With that, I reserve the balance of my time.
Mr. SHERMAN. Mr. Speaker, I yield myself such time as I may consume.
I will be brief. We passed substantially the same language
unanimously by voice vote 2 years ago. This bill has been amended by
unanimous consent so as to be virtually identical with what was passed
2 years ago. It now has the support of the ranking member.
I urge an ``aye'' vote and reserve the balance of my time.
Mrs. CAPITO. Mr. Speaker, I would like to yield as much time as he
needs to consume to the gentleman from Missouri (Mr. Luetkemeyer), who
is the primary sponsor of this bill.
Mr. LUETKEMEYER. Thank you, Chairman Capito, for yielding.
I rise today in strong support of the amended version of H.R. 5817,
the Eliminate Privacy Notice Confusion Act. Under current law, all
financial institutions are required to provide annual privacy notices
explaining information-sharing practices to customers. Banks and credit
unions are required to give these notices each year even if their
privacy notice has not changed. This creates not only waste for
financial institutions but confusion among and increased costs to
consumers.
In his book entitled ``The Financial Crisis and the Free Market
Cure,'' John Allison reports that one bank offered at the end of its
privacy notice to pay $100 to any customer that read its notice in
full. Only one customer took the bank up on that offer.
Year after year, millions of dollars are spent on privacy notices
that are either disregarded by or confuse the customers. Let's think
about this cost for a second. This outdated requirement doesn't cost
only in postage alone, but also costs in compliance costs, cost of
supplies, printing fees, and man hours.
I talked to one community bank in my district that said they spent
roughly 70 cents per disclosure. With a minimum of 250,000 accounts and
customers, this one bank spends $175,000 a year on this requirement. It
may not seem like a lot of money to some of my colleagues, but I can
tell you that $175,000 is a lot of money for a small institution like
this one in my district, especially when a lot of those costs are
passed on to the customer.
There is some debate over what this legislation will do. Let me be
completely clear: this legislation will only remove the Gramm-Leach-
Bliley annual privacy notice requirement of an institution if an
institution has not, in any way, changed its privacy notice or
procedures.
{time} 1350
This legislation does not exempt any institution from an initial
privacy notice, nor does it allow a loophole for an institution to
avoid issuing an updated notice.
We worked in a bipartisan fashion to amend this legislation to remove
the stipulations for State-regulated financial institutions. The
amended language is now identical to the legislation that passed the
House by a voice
[[Page H6724]]
vote in the 111th Congress. Additionally, I would like to remind my
colleagues that similar language, language that was the basis for the
first version of legislation, passed in both the 109th Congress and the
110th Congress.
This language is not controversial, it does not jeopardize consumer
privacy, and it does not exempt an institution from having to produce
an initial or amended privacy notice. This legislation does eliminate
millions of costly, confusing, and often ignored mailings. And, with
the passage of this bill, the information included in these mailings
would likely become more significant to the consumer because it would
come only after a change in the privacy policy.
This legislation is supported by the Independent Community Bankers of
America, the Credit Union National Association, the American Bankers
Association, the National Association of Federal Credit Unions, and the
Consumer Bankers Association, among others.
I'd like to thank the gentleman from California (Mr. Sherman) for his
work on this bill. I would also like to thank Chairman Bachus, Ranking
Member Frank, Chairman Capito, and Ranking Member Maloney for their
work with us toward swift passage of this legislation.
With that, Mr. Speaker, I ask my colleagues for their support.
Mr. SHERMAN. Mr. Speaker, I yield myself such time as I may consume.
I want to thank the gentleman from Missouri for his work and
leadership on this bill. I also want to thank the ranking member, Mr.
Frank, for his support, and, of course, the gentlelady from West
Virginia.
If this bill becomes law, a written copy of the privacy policy will
still go by postal mail to every customer when he or she becomes a
customer of the financial institution. Another copy will go every time
that policy is changed, and the policy will be available day and night
on the Internet on the Web site of the financial institution. The
privacy policy will be known to everyone who has an interest in reading
it, whether $100 is paid as a bonus for reading it or not.
Mr. Speaker, I have no further speakers, and I yield back the balance
of my time.
Mrs. CAPITO. Mr. Speaker, I also urge passage of this bill.
With that, I yield back the balance of my time.
The SPEAKER pro tempore. The question is on the motion offered by the
gentlewoman from West Virginia (Mrs. Capito) that the House suspend the
rules and pass the bill, H.R. 5817, as amended.
The question was taken; and (two-thirds being in the affirmative) the
rules were suspended and the bill, as amended, was passed.
A motion to reconsider was laid on the table.
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