CCH Logo
Contact Us | CCH Online Store | Site Map    

  
navigation tabnavigation tab Home 
navigation tabnavigation tab About Us 
navigation tabnavigation tab Order Products 
navigation tabnavigation tab Press Center 
navigation tabnavigation tab Customer Service 
navigation tabnavigation tab Career Opportunities 
navigation tab
   HomePress CenterPress Releases
 
Press Releases
List By Date
Banking/Finance Institutions
Business Law
Corporate
Health Care and Entitlements
Human Resources
Securities
Tax
News Archives
 

Contact Information

Leslie Bonacum
847-267-7153
mediahelp@cch.com
Neil Allen
847-267-2179
neil.allen@wolterskluwer.com

New Privacy Study Finds Nearly  70 Percent Of Banks And Savings Associations Will Not Share Customer Information

Credit Unions and Finance Companies are More Likely to
Share Customer Information With Nonaffiliated Third Parties

(ST. CLOUD, MINN., May 15, 2001) — When the consumer privacy deadline rolls around in July, credit unions will be twice as likely to share customer information than banks and savings associations, according to Bankers Systems’ recent study of the sharing practices of over 3,900 financial institutions.

The study, which included banks, savings associations, credit unions, and finance companies who worked with Bankers Systems on their privacy disclosures, found that the majority of banks and thrift institutions (68.8 percent) indicated they would not be sharing customer information with affiliates or nonaffiliates. Over 90 percent of those that are sharing customer information indicated they will do so within the exceptions, and will not be providing opt-out notices.

Thirty-four percent of credit unions in the analysis said they will not be sharing customer information with affiliates or nonaffiliates. Nearly half of those that are sharing customer information indicated they will be sharing within the exceptions, and will not be providing opt-out notices. Credit unions that will share the information said they do so in the best interest of their members because it will result in opportunities for additional services of value for them.

Finance companies also showed a greater propensity to share. More than half (51.9 percent) indicated they will disclose that they share, or reserve the right to share, their customers’ information with nonaffiliated third parties. However, they all indicated they share information within the exceptions, and will not be providing opt-out notices.

Asset Size and Location Play a Role

Asset size appears to play a role in the decision of whether or not to share customer information. Bankers Systems’ analysis shows that the largest institutions are far more likely to engage in third-party information sharing than smaller institutions. For example, 63.5 percent of banks and savings institutions with over $1 billion in assets plan to disclose that they share, or plan to share, customer information. Conversely, only 30 percent of banks and savings institutions with under $1 billion in assets plan to disclose that they will share the customer information.

State by state comparisons also yielded some distinguishing data. In Colorado, Vermont, Mississippi, Montana, North Dakota, Oklahoma, and Illinois, nonsharing institutions outnumber their sharing counterparts by a margin of more than three to one. In contrast, two states were found to have an overwhelming majority of sharing institutions. In Michigan, 71.7 percent of the institutions studied plan to share customer data, and in Utah, 69 percent intend to do so.

Ready … Or Not?

Bankers Systems’ study also found that nonsharing institutions are more likely to provide their notices well in advance of the compliance deadline. This can be attributed, in part, to the fact that their compliance requirements allow for shorter, simpler notices, which can be finished more quickly. Institutions with more complex notices that include opt-out language are less likely to have their notices completed and mailed early.

In addition to the study on sharing practices, Bankers Systems has been conducting a survey through its privacy portal—PrivacyHeadquarters.com—to determine just how prepared institutions are to meet the privacy disclosure deadline in July. With over 500 financial institutions responding so far, the results are as follows:

• 9 percent of the institutions have already sent out their privacy notices,

• 28 percent have their privacy policies drafted and printed,

• 52 percent are in the process of developing their privacy policies and notices, and

• 11 percent have just begun to study the requirements.

According to Bankers Systems’ attorney Katie Iverson, these numbers are not surprising. "Banks, credit unions, and thrift institutions are used to this type of major regulation. For them, it’s a normal part of doing business. As a result, they began preparing early, and for the most part are in good shape to meet the financial privacy deadlines in the Gramm-Leach-Bliley (GLB) Act," said Iverson.

"On the other hand, some organizations that will be impacted by GLB, such as automobile dealers and insurance companies, are more retail-oriented and are not accustomed to this type of regulation," said Iverson. "They may not understand the magnitude of the research, analysis, and decision making that is required in order to accurately develop and disclose their privacy policies. Many of these organizations are not far along in this process, and many of them will be scrambling before July."

Bankers Systems is the leading national provider of compliance resources solutions, including documents, disclosures, software, training and services. The company offers a full range of products and services to help financial institutions deal with the privacy provisions of the Gramm-Leach-Bliley Act. Bankers Systems’ privacy products include tailored disclosures in various mediums (paper, electronic, or web); training tools; PrivacyStateWise internet tool for managing state-specific financial privacy issues in the banking, insurance, and mortgage industries; and PrivacyHeadquarters.com, the heavily visited portal dedicated solely to providing comprehensive privacy information for banking, insurance, securities, and mortgage professionals at no charge.

About Bankers Systems

Bankers Systems, Inc., a CCH INCORPORATED company, is a leading national provider of compliance resource solutions for financial institutions and their legal counsel. The company’s deposit, lending, and retirement plan documents, disclosures, software, training, and support services are used by more than 12,000 financial institutions, including 83 percent of banks in the U.S. In addition, over 60 leading core processors and systems integrators use Bankers Systems’ compliance-related documents and other components in their solutions. For more information, call 800-552-9410 or visit www.bankerssystems.com.

Bankers Systems Inc. is a registered trademark of Bankers Systems, Inc.

-- ### --

       


   © 2018, CCH INCORPORATED. All rights reserved.   

  Back to Top | Print this Page   
spacer