[Congressional Record (Bound Edition), Volume 158 (2012), Part 12]
[House]
[Pages 16967-16968]
[From the U.S. 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--

[[Page 16968]]

       ``(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 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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