[Federal Register Volume 73, Number 64 (Wednesday, April 2, 2008)]
[Notices]
[Pages 17980-17982]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-6821]


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FEDERAL TRADE COMMISSION


Agency Information Collection Activities; Proposed Collection; 
Comment Request; Extension

AGENCY: Federal Trade Commission (``Commission'' or ``FTC'').

ACTION: Notice.

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SUMMARY: The information collection requirements described below will 
be submitted to the Office of Management and Budget (``OMB'') for 
review, as required by the Paperwork Reduction Act (``PRA''). The FTC 
is seeking public comments on its proposal to extend through July 31, 
2011, the current PRA clearance for information collection requirements 
contained in the Commission's Gramm-Leach-Bliley Financial Privacy Rule 
(``GLB Privacy Rule'' or ``Rule''). The current clearance expires on 
July 31, 2008.

DATES: Comments must be submitted on or before June 2, 2008.

ADDRESSES: Interested parties are invited to submit written comments. 
Comments should refer to ``Paperwork Comment: FTC File No. P085405'' 
and may be submitted by any of the following methods. If, however, the 
comment contains any material for which confidential treatment is 
requested, it must be filed in paper form, and the first page of the 
document must be clearly labeled ``Confidential.''\1\
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    \1\ Commission Rule 4.2(d), 16 CFR 4.2(d). The comment must be 
accompanied by an explicit request for confidential treatment, 
including the factual and legal basis for the request, and must 
identify the specific portions of the comment to be withheld from 
the public record. The request will be granted or denied by the 
Commission's General Counsel, consistent with applicable law and the 
public interest. See Commission Rule 4.9(c), 16 CFR 4.9(c).
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    1. Web Site: Comments filed in electronic form should be submitted 
by clicking on the following web link: https://secure.commentworks.com/ftc-glbprivacyrulepra and following the instructions on the web-based 
form. To ensure that the Commission considers an electronic comment, 
you must file it on the web-based form at: https://secure.commentworks.com/ftc-glbprivacyrulepra.
    2. Mail or Hand Delivery: A comment filed in paper form should 
include ``Paperwork Comment: FTC File No. P085405'' both in the text 
and on the envelope and should be mailed or delivered to the following 
address: Federal Trade Commission/Office of the Secretary, Room H-135 
(Annex J), 600 Pennsylvania Avenue, N.W., Washington, D.C. 20580. The 
Commission is requesting that any comment filed in paper form be sent 
by courier or overnight service, if possible.
    The FTC Act and other laws the Commission administers permit the 
collection of public comments to consider and use in this proceeding as 
appropriate. All timely and responsive public comments will be 
considered by

[[Page 17981]]

the Commission and will be available to the public on the FTC website, 
to the extent practicable, at www.ftc.gov. As a matter of discretion, 
the FTC makes every effort to remove home contact information for 
individuals from the public comments it receives before placing those 
comments on the FTC website. More information, including routine uses 
permitted by the Privacy Act, may be found in the FTC's privacy policy 
at http://www.ftc.gov/ftc/privacy.shtm.

FOR FURTHER INFORMATION CONTACT: Kellie Cosgrove Riley, Senior 
Attorney, Division of Privacy and Identity Protection, Bureau of 
Consumer Protection, (202) 326-2252, Federal Trade Commission, 600 
Pennsylvania Avenue, N.W., Washington D.C. 20580.

SUPPLEMENTARY INFORMATION: Under the PRA, 44 U.S.C. 3501-3521, federal 
agencies must obtain approval from OMB for each collection of 
information they conduct or sponsor. ``Collection of information'' 
means agency requests or requirements that members of the public submit 
reports, keep records, or provide information to a third party. 44 
U.S.C. 3502(3), 5 CFR 1320.3(c). As required by section 3506(c)(2)(A) 
of the PRA, the FTC is providing this opportunity for public comment 
before requesting that OMB extend the existing paperwork clearance for 
the GLB Privacy Rule, 16 CFR Part 313 (OMB Control Number 3084-0121).
    The FTC invites comments on: (1) whether the proposed collection of 
information is necessary for the proper performance of the functions of 
the agency, including whether the information will have practical 
utility; (2) the accuracy of the agency's estimate of the burden of the 
proposed collection of information, including the validity of the 
methodology and assumptions used; (3) ways to enhance the quality, 
utility, and clarity of the information to be collected; and (4) ways 
to minimize the burden of the collection of information on those who 
are to respond, including through the use of appropriate automated, 
electronic, mechanical, or other technological collection techniques or 
other forms of information technology, e.g., permitting electronic 
submission of responses.
    The GLB Privacy Rule is designed to ensure that customers and 
consumers, subject to certain exceptions, will have access to the 
privacy policies of the financial institutions with which they conduct 
business. As mandated by the Gramm-Leach-Bliley Act, 15 U.S.C. 6801-
6809, the Rule requires financial institutions to disclose to 
consumers: (1) initial notice of the financial institution's privacy 
policy when establishing a customer relationship with a consumer and/or 
before sharing a consumer's non-public personal information with 
certain nonaffiliated third parties; (2) notice of the consumer's right 
to opt out of information sharing with such parties; (3) annual notice 
of the institution's privacy policy to any continuing customer; and (4) 
notice of changes in the institution's practices on information 
sharing. These requirements are subject to the PRA. The Rule does not 
require recordkeeping.
     Estimated annual hours burden: As noted in the original burden 
estimate for the GLB Privacy Rule, determining the paperwork burden of 
the Rule's disclosure requirements is very difficult because of the 
highly diverse group of affected entities, consisting of financial 
institutions not regulated by a federal financial regulatory agency. 
See 15 U.S.C. 6805 (committing to the Commission's jurisdiction 
entities that are not specifically subject to another agency's 
jurisdiction).
    The burden estimates represent the FTC staff's best assessment, 
based on its knowledge and expertise relating to the financial 
institutions subject to the Commission's jurisdiction under this law. 
To derive these estimates, staff considered the wide variations in 
covered entities. In some instances, covered entities may make the 
required disclosures in the ordinary course of business, apart from the 
GLB Privacy Rule. In addition, some entities may use highly automated 
means to provide the required disclosures, while others may rely on 
methods requiring more manual effort. The burden estimates shown below 
include the time that may be necessary to train staff to comply with 
the regulations. These figures are averages based on staff's best 
estimate of the burden incurred over the broad spectrum of covered 
entities.
    Staff retains its prior estimate of the number of entities each 
year that will address the GLB Privacy Rule for the first time (5,000) 
and its estimate of established entities already familiar with the Rule 
(100,000). While the number of established entities familiar with the 
Rule would theoretically increase each year with the addition of new 
entrants, staff retains its previous estimate of established entities 
given that a number of the established entities will close in any given 
year, and also given the difficulty of establishing a more precise 
estimate. Staff's burden estimates for new entrants and established 
entities are detailed in the charts below.

Start-up hours and labor costs for new entrants:

------------------------------------------------------------------------
                                                     Approx.    Approx.
            Hourly wage   Hours per      Approx.      Total      Total
  Event      and labor    Respondent    Number of     Annual     Labor
            category\*\                Respondents     Hrs.      Costs
------------------------------------------------------------------------
Reviewing  $31.66        20           5,000         100,000    $3,166,00
 internal  managerial/                                          0
 policies   professiona
 and        l
 developi
 ng GLBA-
 implemen
 ting
 instruct
 ions\**\
------------------------------------------------------------------------
Creating   $14.71        5            5,000         25,000     $367,750
 disclosu  clerical
 re
 document
 or
 electron
 ic
 disclosu
 re
 (includi
 ng
 initial,
 annual,
 and opt
 out
 disclosu
 res)
          ---------------------------              ---------------------
           $32.82        10           ............  50,000     $1,641,00
           professional/                                        0
            technical
------------------------------------------------------------------------
Dissemina  $14.71        15           5,000         75,000     $1,103,25
 ting      clerical                                             0
 initial
 disclosu
 re
 (includi
 ng opt
 out
 notices)
          ---------------------------              ---------------------

[[Page 17982]]

 
           $32.82        10           ............  50,000     $1,641,00
           professional/                                        0
            technical
------------------------------------------------------------------------
Total      ............  ...........  ............  300,000    $7,919,00
                                                                0
------------------------------------------------------------------------
\*\ Staff calculated labor costs by applying appropriate hourly cost
  figures to burden hours. The hourly rates used were based on mean
  wages for managerial/professional time (e.g., compliance evaluation
  and/or planning), professional/technical time (e.g., designing and
  producing notices, reviewing and updating information systems), and
  clerical time (e.g., reproduction tasks, filing, and, where applicable
  to the given event, typing or mailing). See BLS National Compensation
  Survey, June 2006, Table 1, available at http://www.bls.gov/ncs/ocs/sp/ncbl0910.pdf (Management, professional, and related; office and
  administrative support) and BLS Occupational Employment and Wages
  2006,Table 2, available at http://www.bls.gov/news.release/pdf/ocwage.pdf (professional, scientific, and technical services -
  business and financial operations). Labor cost totals reflect solely
  that of the commercial entities affected. Staff assumes that the time
  required of consumers to respond affirmatively to respondents' opt-out
  programs (be it manually or electronically) would be minimal.
\**\ Reviewing instructions includes all efforts performed by or for the
  respondent to: determine whether and to what extent the respondent is
  covered by an agency collection of information, understand the nature
  of the request, and determine the appropriate response (including the
  creation and dissemination of document and/or electronic disclosures).

Burden hours and costs for established entities:

    Burden for established entities already familiar with the Rule 
predictably would be less than for start-up entities because start-up 
costs, such as crafting a privacy policy, are generally one-time costs 
and have already been incurred. Staff's best estimate of the average 
burden for these entities is as follows:

------------------------------------------------------------------------
                                                       Approx.   Approx.
            Hourly wage   Hours per   Approx. Number    Total     Total
  Event      and labor   Respondent         of         Annual     Labor
            category\*\              Respondents\**\    Hrs.      Costs
------------------------------------------------------------------------
Reviewing  $31.66        4           70,000           280,000   $8,864,8
 GLBA-     managerial/                                           00
 implemen   professiona
 ting       l
 policies
 and
 practice
 s
------------------------------------------------------------------------
Dissemina  $14.71        15          70,000           1,050,00  $15,445,
 ting      clerical                                    0         500
 annual
 disclosu
 re
          --------------------------                 -------------------
           $32.82        5           ...............  350,000   $11,487,
           professional/                                         000
            technical
------------------------------------------------------------------------
Changes    $14.71        15          1,000            15,000    $220,650
 to        clerical
 privacy
 policies
 and
 related
 disclosu
 res
          --------------------------                 -------------------
           $32.82        10          ...............  50,000    $164,100
           professional/
            technical
------------------------------------------------------------------------
Total      ............  ..........  ...............  1,700,00  $36,182,
                                                       0         050
------------------------------------------------------------------------
\*\ Staff calculated labor costs by applying appropriate hourly cost
  figures to burden hours; labor cost totals reflect solely that of the
  commercial entities affected. The hourly rates used were based on mean
  wages for managerial/professional time (e.g., compliance evaluation
  and/or planning), professional/technical time (e.g., designing and
  producing notices, reviewing and updating information systems), and
  clerical time (e.g., reproduction tasks, filing, and, where applicable
  to the given event, typing or mailing). See BLS National Compensation
  Survey, June 2006, Table 1, available at http://www.bls.gov/ncs/ocs/sp/ncbl0910.pdf (Management, professional, and related; office and
  administrative support) and BLS Occupational Employment and Wages
  2006,Table 2, available at http://www.bls.gov/news.release/pdf/ocwage.pdf (professional, scientific, and technical services -
  business and financial operations). Consumers have a continuing right
  to opt-out, as well as a right to revoke their opt-out at any time.
  When a respondent changes its information sharing practices, consumers
  are again given the opportunity to opt-out. Again, staff assumes that
  the time required of consumers to respond affirmatively to
  respondents' opt-out programs (be it manually or electronically) would
  be minimal.
\**\ The estimate of respondents is based on the following assumptions:
  (1) 100,000 respondents, approximately 70% of whom maintain customer
  relationships exceeding one year, (2) no more than 1% (1,000) of whom
  make additional changes to privacy policies at any time other than the
  occasion of the annual notice; and (3) such changes will occur no more
  often than once per year.

    As calculated above, the total annual PRA burden hours and labor 
costs for all affected entities in a given year would be 2,000,000 
hours and $44,101,000, respectively.
    Estimated Capital/Other Non-Labor Costs Burden: Staff believes that 
capital or other non-labor costs associated with the document requests 
are minimal. Covered entities will already be equipped to provide 
written notices (e.g., computers with word processing programs, 
typewriters, copying machines, mailing capabilities). Most likely, only 
entities that already have on-line capabilities will offer consumers 
the choice to receive notices via electronic format. As such, these 
entities will already be equipped with the computer equipment and 
software necessary to disseminate the required disclosures via 
electronic means.

William Blumenthal
General Counsel
[FR Doc. E8-6821 Filed 4-1-08: 8:45 am]
BILLING CODE 6750-01-S]