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| Draft Data Privacy Bill includes Important Relief |
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Proposed data privacy legislation acknowledges existing financial institution requirements but brings some concerns. America’s Credit Unions detailed the important relief provided and additional recommendations in a letter to House Financial Services Committee Chairman French Hill, R-Ark., and bill sponsor Rep. Bill Huizenga, R-Mich.
The bill would amend Title V of the Gramm-Leach-Bliley Act (GLBA), and was discussed by the committee in a hearing earlier this month.
“While the proposed bill includes important relief—such as exceptions designed to preserve operational flexibility around data retention activities, recognition of small financial institution compliance costs, and a significant provision relating to preemption of state laws—credit unions are concerned that expansion of the GLBA’s obligations for financial institutions when undertaken alone will contribute to greater burden without the benefit of consistent federal safeguards applying across the wider economy,” wrote Greg Mesack, senior vice president of advocacy.
The bill’s preemption features are significant and “should serve as a baseline component in any future privacy legislation that impacts financial institutions,” Mesack added.
America’s Credit Unions made recommendations to modify the draft legislation to implement requirements for data minimization, consumer notice, and access and deletion rights, without overburdening credit unions or introducing litigation risk, while preserving or strengthening the ability to detect and combat fraud. It also emphasizes the importance of specific language directing regulators to consider relief for smaller institutions.
The letter was in response to a request from the Committee to provide industry feedback on the discussion draft of the bill by last Friday.
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