Financial Privacy Notices Are Gibberish, Critics Say
Consumer advocates argued yesterday that the privacy notices being sent by financial institutions to comply with Gramm-Leach-Bliley are pure nonsense. And they plan to ask the Federal Trade Commission to toughen up its rules.
“The banks don’t speak English, and we think they do it on purpose,” said Ed Mierzwinski, consumer program director at the U.S. Public Interest Research Group, according to Reuters. “They are hiding your right to say no behind pages and pages of unintelligible gibberish.”
Many critics agree that the messages sent to date are obtuse. Rep. John LaFalce (D-NY), who plans to complain to Treasury Secretary Paul O’Neill, Fed Chairman Alan Greenspan and other bank regulators, according to the Associated Press.
And conservative columnist William Safire called yesterday for the law to be changed from opt-out to opt-in.
“You’ve probably been getting mail lately from your bank spelling out in unintelligible prose its “privacy policy,” Safire wrote yesterday in the New York Times. “Unless you assume the burden of ‘opting out’ by filling out a form, finding a stamp and mailing it back, the bank can share all your private dealings with any affiliates or marketer or just about anybody.”
Passed in 1999, Gramm-Leach-Bliley requires financial institutions to notify customers annually of their data-sharing practices with both affiliates and non-affiliates. It also states that they must allow consumers to opt out of any sharing with non-affiliates. The deadline for compliance is July 1.
Marcia Sullivan, vice president of the Consumer Bankers Association, defended the notices.
“Language used in privacy notices reflects a balance between the need to clearly explain complex provisions to consumers and satisfy legal requirements of the regulations,” Sullivan said in a statement.
