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| New House Bills to update data Privacy framework |
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A joint effort by two House committees is moving landmark data privacy bills forward that would create a national standard. The House Financial Services Committee and House Energy and Commerce Committee announced their work together with the GUARD Financial Data Act and the SECURE Data Act. Throughout this Congress, America’s Credit Unions has engaged both committees on the need for updated data privacy and security standards that protect consumers and do not increase compliance burdens for credit unions.
"We want to thank the House Financial Services Committee and House Energy and Commerce Committee for taking the lead in creating legislation to establish a clear national standard for privacy. We appreciate Congress's recognition that basic data security and privacy standards should also apply to non-financial entities. The Gramm-Leach Bliley Act has long served as the basis for applying such standards to credit unions, and it's a positive sign that both bills recognize the scope of existing financial institution compliance within a unified federal framework. Such differentiation matters for credit unions,” said America’s Credit Unions President/CEO Scott Simpson.
Specifically, the bills:
• Require non-financial firms that control consumer data (controller) and financial institutions to limit the collection of a consumer’s data to only necessary uses;
• Give consumers the right to request access to and obtain a copy of their data that is possessed by a controller or financial institution in a transferrable format;
• Give consumers the right to request deletion of their data possessed by a controller or financial institution;
• Require controllers and financial institutions to obtain a consumer opt-in before taking any actions with the consumer’s sensitive data;
• Establish national standards for the protection of Americans’ personal data, ending the confusing and ineffective privacy patchwork currently in place.
The SECURE Data Act exempts Gramm-Leach-Bliley Act-covered financial data and financial institutions from its scope, which would include credit unions, while the GUARD Financial Data Act exempts nonfinancial firms and their operations from its scope.
“With the growing patchwork of state laws complicating these efforts, we support efforts to clarify preemption. These bills address several new issues that we are evaluating, and we look forward to working with both committees to ensure an appropriate balance of protecting American consumers and minimizing unnecessary regulatory burden in any final legislation,” continued Simpson.
America’s Credit Unions also appreciates that the GUARD Financial Data Act recognizes the importance of appropriately tailoring regulations for smaller financial institutions. The association will continue to urge Congress to ensure federal legislation includes protection from frivolous lawsuits created by a private right of action.
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