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Federal Reserve Bank
of Dallas
l l★K
DALLAS, TEXAS
75265-5906
November 6, 2000
Notice 00-67
TO: The Chief Executive Officer of each
financial institution and others concerned
in the Eleventh Federal Reserve District
SUBJECT
Request for Public Comment on
Proposed Consumer Protection Rules for Affiliate
Information Sharing Practices
DETAILS
The Board of Governors of the Federal Reserve System, the Federal Deposit Insurance Corporation, the Office of the Comptroller of the Currency, and the Office of Thrift Supervision have requested public comment on proposed regulations implementing the provisions of
the Fair Credit Reporting Act (FCRA). The act permits institutions to communicate consumer
information to their affiliate (affiliate information sharing) without incurring the obligations of
consumer reporting agencies. These provisions authorize institutions to communicate among
their affiliates the following:
•
Information regarding transactions or experiences between the consumer and the
person making the communication (transaction or experience information); and
•
Other information (that is, information covered by the FCRA but not transaction
or experience information), provided that the institution has given notice to the
consumer that the other information may be communicated, the institution has
provided the consumer an opportunity to “opt out” (i.e., to direct that the information not be communicated), and the consumer has not opted out.
The proposed regulations explain how to comply with the affiliate information and
sharing provisions, addressing such matters as the content and delivery of the notice to consumers that “other” information may be communicated (opt out notice). Also, the proposed regula-
For additional copies, bankers and others are encouraged to use one of the following toll-free numbers in contacting the Federal
Reserve Bank of Dallas: Dallas Office (800) 333-4460; El Paso Branch Intrastate (800) 592-1631, Interstate (800) 351-1012;
Houston Branch Intrastate (800) 392-4162, Interstate (800) 221-0363; San Antonio Branch Intrastate (800) 292-5810.
-2tions implement certain related provisions. The agencies have attempted to conform these proposed regulations to the final regulations implementing the privacy provisions of the GrammLeach-Bliley Act whenever feasible.
The Board must receive comments by December 4, 2000. Please address comments to
Jennifer J. Johnson, Secretary, Board of Governors of the Federal Reserve System, 20th and C
Streets, N.W., Washington, DC 20551. Also, you may mail comments electronically to
regs.comments@federalreserve.gov. All comments should refer to Docket No. R-1082.
ATTACHMENT
A copy of the Board’s notice as it appears on pages 63120–41, Vol. 65, No. 204 of the
Federal Register dated October 20, 2000, is attached.
MORE INFORMATION
For more information, please contact Eugene Coy, Banking Supervision Department,
(214) 922-6201. For additional copies of this Bank’s notice, contact the Public Affairs Department at (214) 922-5254 or access District Notices on our web site at
http://www.dallasfed.org/banking/notices/index.html.
Friday,
October 20, 2000
Part II
Department of the
Treasury
Office of the Comptroller of the
Currency
Office of Thrift Supervision
Federal Reserve System
Federal Deposit
Insurance Corporation
12 CFR Parts 41, 222, 334 and 571
Fair Credit Reporting Regulations;
Proposed Rule
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63120
Federal Register / Vol. 65, No. 204 / Friday, October 20, 2000 / Proposed Rules
DEPARTMENT OF THE TREASURY
Office of the Comptroller of the
Currency
12 CFR Part 41
[Docket No. 00–20]
RIN 1557–AB78
FEDERAL RESERVE SYSTEM
12 CFR Part 222
[Regulation V; Docket No. R–1082]
FEDERAL DEPOSIT INSURANCE
CORPORATION
12 CFR Part 334
RIN 3064–AC35
DEPARTMENT OF THE TREASURY
Office of Thrift Supervision
12 CFR Part 571
[Docket No. 2000–81]
RIN 1550–AB33
Fair Credit Reporting Regulations
AGENCIES: Office of the Comptroller of
the Currency, Treasury (OCC); Board of
Governors of the Federal Reserve
System (Board); Federal Deposit
Insurance Corporation (FDIC); and
Office of Thrift Supervision, Treasury
(OTS).
ACTION: Joint notice of proposed
rulemaking.
SUMMARY: The OCC, Board, FDIC, and
OTS (Agencies) are publishing for
comment proposed regulations
implementing the provisions of the Fair
Credit Reporting Act (FCRA) that permit
institutions to communicate consumer
information to their affiliates (affiliate
information sharing) without incurring
the obligations of consumer reporting
agencies. These provisions authorize
institutions to communicate among
their affiliates: Information as to
transactions or experiences between the
consumer and the person making the
communication (transaction or
experience information); and ‘‘other’’
information (that is, information
covered by the FCRA but not transaction
or experience information), provided
that the institution has given notice to
the consumer that the other information
may be communicated, the institution
has provided the consumer an
opportunity to ‘‘opt out’’ (i.e., to direct
that the information not be
communicated), and the consumer has
not opted out. The proposed regulations
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explain how to comply with the affiliate
information sharing provisions,
addressing such matters as the content
and delivery of the notice to consumers
that ‘‘other’’ information may be
communicated (opt out notice). The
proposed regulations also implement
certain related provisions. The Agencies
have attempted to conform these
proposed regulations to the final
regulations implementing the privacy
provisions of the Gramm-Leach-Bliley
Act whenever feasible.
DATES: Comments must be received by
December 4, 2000.
ADDRESSES: Comments should be
directed to:
OCC: Communications Division,
Office of the Comptroller of the
Currency, 250 E Street, SW.,
Washington, D.C. 20219, Attention:
Docket No. 00–20; FAX number (202)
874–5274 or Internet address:
regs.comments@occ.treas.gov.
Comments may be inspected and
photocopied at the OCC’s Public
Reference Room, 250 E Street, SW.,
Washington D.C. between 9:00 a.m. and
5:00 p.m. on business days. You can
make an appointment to inspect the
comments by calling (202) 874–5043.
Board: Comments, which should refer
to Docket No. R–1082, may be mailed to
Ms. Jennifer J. Johnson, Secretary, Board
of Governors of the Federal Reserve
System, 20th and C Streets, NW.,
Washington, D.C. 20551 or mailed
electronically to
regs.comments@federalreserve.gov.
Comments addressed to Ms. Johnson
also may be delivered to the Board’s
mail room between 8:45 a.m. and 5:15
p.m. and to the security control room
outside of those hours. Both the mail
room and the security control room are
accessible from the courtyard entrance
on 20th Street between Constitution
Avenue and C Street, NW. Comments
may be inspected in Room MP–500
between 9:00 a.m. and 5:00 p.m.,
pursuant to § 261.12, except as provided
in § 261.14, of the Board’s Rules
Regarding the Availability of
Information, 12 CFR 261.12 and 261.14.
FDIC: Send written comments to
Robert E. Feldman, Executive Secretary,
Attention: Comments/OES, Federal
Deposit Insurance Corporation, 550 17th
Street, NW., Washington, DC 20429.
Comments may be hand delivered to the
guard station at the rear of the 17th
Street building (located on F Street) on
business days between 7 a.m. and 5 p.m.
(FAX number (202) 898–3838).
Comments may be inspected and
photocopied in the FDIC Public
Information Center, Room 100, 801 17th
Street, NW., Washington, DC 20429,
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between 9:00 a.m. and 4:30 p.m. on
business days.
Comments may be submitted to the
FDIC electronically over the Internet at
www.fdic.gov. Further information
concerning this option may be found
below at ‘‘FDIC’s Electronic Public
Comment Site.’’ Comments also may be
mailed electronically to
comments@fdic.gov.
OTS: Mail: Send comments to
Manager, Dissemination Branch,
Information Management and Services
Division, Office of Thrift Supervision,
1700 G Street, NW., Washington, DC
20552, Attention Docket No. 2000–81.
Delivery: Hand deliver comments to
the Guard’s Desk, East Lobby Entrance,
1700 G Street, NW., from 9:00 a.m. to
4:00 p.m. on business days, Attention
Docket No. 2000–81.
Facsimiles: Send facsimile
transmissions to FAX Number (202)
906–7755, Attention Docket No. 2000–
81; or (202) 906–6956 (if comments are
over 25 pages).
E-Mail: Send e-mails to
‘‘public.info@ots.treas.gov’’, Attention
Docket No. 2000–81, and include your
name and telephone number.
Public Inspection: Interested persons
may inspect comments at the Public
Reference Room, 1700 G St. N.W., from
10:00 a.m. until 4:00 p.m. on Tuesdays
and Thursdays or obtain comments and/
or an index of comments by facsimile by
telephoning the Public Reference Room
at (202) 906–5900 from 9:00 a.m. until
5:00 on business days. Comments and
the related index will also be posted on
the OTS Internet Site at
‘‘www.ots.treas.gov’’.
FOR FURTHER INFORMATION CONTACT:
OCC: Amy Friend, Assistant Chief
Counsel, (202) 874–5200; Michael
Bylsma, Director, Community and
Consumer Law, (202) 874–5750;
Stephen Van Meter, Senior Attorney,
Community and Consumer Law, (202)
874–5750; Carol Workman, Compliance
Specialist, Community and Consumer
Policy, (202) 874–4858; Deborah Katz,
Senior Attorney, Legislative and
Regulatory Activities Division, (202)
874–5090; or Jeffery Abrahamson,
Attorney, Enforcement and Compliance,
(202) 874–4800, Office of the
Comptroller of the Currency, 250 E
Street, SW., Washington, DC 20219.
Board: James H. Mann, Senior
Attorney, (202) 452–2412; or David A.
Stein, Attorney, (202) 452–3667,
Division of Consumer and Community
Affairs. For the hearing impaired only,
contact Janice Simms,
Telecommunications Device for the Deaf
(TDD) (202) 872–4984, Board of
Governors of the Federal Reserve
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System, 20th and C Streets, NW.,
Washington, DC 20551.
FDIC: James K. Baebel, Assistant
Director, Compliance Policy, Division of
Compliance and Consumer Affairs,
(202) 942–3086; Deanna Caldwell,
Community Affairs Officer, Division of
Compliance and Consumer Affairs,
(202) 736–0141; Nancy Schucker
Recchia, Counsel, Regulations and
Legislation Section, (202) 898–8885; A.
Ann Johnson, Counsel, Regulations and
Legislation Section, (202) 898–3573; and
David Lafleur, Senior Compliance
Examiner, (415) 395–5261, Federal
Deposit Insurance Corporation, 550 17th
Street, NW., Washington, DC 20429.
OTS: Christine Harrington, Counsel
(Banking and Finance), (202) 906–7957;
Paul Robin, Assistant Chief Counsel,
(202) 906–6648; or Elizabeth Baltierra,
Program Analyst, Compliance Policy
(202) 906–6540, Office of Thrift
Supervision, 1700 G Street, NW.,
Washington DC 20552.
SUPPLEMENTARY INFORMATION:
I. Background
The FCRA
The FCRA, enacted in 1970, sets
standards for the collection,
communication, and use of information
bearing on a consumer’s credit
worthiness, credit standing, credit
capacity, character, general reputation,
personal characteristics, or mode of
living. 15 U.S.C. 1681–1681u. In 1996,
the Consumer Credit Reporting Reform
Act amended the FCRA extensively
(1996 Amendments). Pub. L. 104–208,
110 Stat. 3009.
For many years, to avoid the
obligations of consumer reporting
agencies imposed by the FCRA, many
institutions avoided making any
communications to affiliated companies
of consumer information that could
constitute consumer reports.1 The 1996
Amendments, however, excluded
specified types of information sharing
with affiliates from the definition of
‘‘consumer report,’’ assuring institutions
that making these communications
would not expose them to the
obligations of consumer reporting
agencies. In particular, the 1996
Amendments excluded from the
definition of ‘‘consumer report’’ the
sharing of ‘‘other’’ information among
affiliates, so long as the consumer,
having been given notice and an
1 The FCRA creates substantial obligations for
‘‘consumer reporting agencies.’’ FCRA, section
603(f); see, e.g., sections 607, 611. These obligations
include furnishing consumer reports only for
permissible purposes, maintaining high standards
for ensuring the accuracy of information in
consumer reports, resolving customer disputes, and
other matters.
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opportunity to opt out, did not opt out.
‘‘Other information’’ refers to
information that is covered by the FCRA
and that is not a report containing
information solely as to transactions or
experiences between the consumer and
the person making the report.
The 1996 Amendments prohibited the
Agencies from issuing implementing
regulations. 15 U.S.C. 1681s(a)(4)
(repealed). The Gramm-Leach-Bliley Act
(GLBA) repealed this prohibition and
directed the Agencies to prescribe
jointly such regulations as necessary to
carry out the purposes of the FCRA.
Pub. L. Sec. 506, 106–102, 15 U.S.C.
1681s(e).
Coordination With Privacy Regulations
The GLBA sets standards for financial
institutions’ disclosure of nonpublic
personal information to nonaffiliated
third parties (privacy provisions; Pub. L.
106–102, 15 U.S.C. 6802; see also 15
U.S.C. 6803). The Agencies published
final regulations implementing these
privacy provisions on June 1, 2000
(privacy regulations; 65 FR 35162, June
1, 2000).
The privacy regulations do not
‘‘modify, limit, or supersede the
operation of the Fair Credit Reporting
Act.’’ 15 U.S.C. 6806. Thus, both the
privacy regulations and the FCRA may
apply to an institution’s disclosure of
consumer information. Moreover, if a
financial institution provides an opt out
notice under the FCRA, that notice must
be included in certain notices mandated
by the privacy regulations, including
annual notices to customers. 15 U.S.C.
6803. Therefore, the Agencies anticipate
that financial institutions will design
their information-sharing policies and
practices taking into account both the
privacy regulations and the regulations
implementing the FCRA.
To ease compliance and promote
consistency, the Agencies are
conforming the two regulations where
appropriate. For example, the Agencies
are proposing requirements regarding
the content and delivery of the FCRA
opt out notice that are generally
consistent with the corresponding
provisions of the privacy regulations.
This Proposal and Future Agency
Issuances
The FCRA raises many significant
issues in addition to affiliate
information sharing. The Agencies are
analyzing these issues and expect to
address them in an Advance Notice of
Proposed Rulemaking. Additionally, the
Agencies will review a series of
questions and answers regarding the
FCRA (Qs & As) that the Agencies
(including the Federal Home Loan Bank
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63121
Board, predecessor of the OTS) issued
in 1971. These were designed to help
financial institutions develop a working
knowledge of the statute. The Agencies
will modify or withdraw any Qs & As
that are inconsistent with the FCRA or
obsolete.
II. Section-by-Section Analysis
Section
.1
Purpose and Scope
Proposed paragraph
.1(a) briefly
describes the purpose of the regulations.
Proposed paragraph
.1(b) briefly
describes the scope of the regulations,
including the information and
institutions subject to them. (These
institutions are identified in more detail
in proposed section
.3(m) of the
Board, FDIC, and OTS regulations.)
Paragraph
.1(b) also provides that
nothing in this part modifies, limits, or
supersedes the standards governing the
privacy of individually identifiable
health information promulgated by the
Secretary of Health and Human Services
pursuant to sections 262 and 264 of the
Health Insurance Portability and
Accountability Act (HIPAA) of 1996 (42
U.S.C. 1320d–1320d–8). Certain
institutions that possess medical
information about consumers may be
covered by these regulations, the GLBA
privacy regulations, and rules
promulgated by the Department of
Health and Human Services (HHS)
under the authority of sections 262 and
264 of HIPAA once those regulations are
finalized. Based on the proposed HIPAA
rules, it appears likely that there will be
areas of overlap between the HIPAA and
the FCRA affiliate information-sharing
rules. For instance under the HIPAA
proposal, consumers must provide
affirmative authorization before a
‘‘covered institution’’ or its ‘‘business
partner’’ may disclose medical
information in certain instances,
whereas under these proposed FCRA
affiliate information sharing rules,
institutions need only provide
consumers with the opportunity to opt
out of disclosures. In cases where the
HIPAA requires consumers to opt in
before certain information may be
shared, but this rule allows consumers
to opt out of the same sharing, opt in
would be necessary before the
information may be shared. The
Agencies will consult with HHS to
avoid the imposition of duplicative or
inconsistent requirements.
Section
.2
Examples
Proposed section .2 clarifies that the
examples used in the regulations and in
the sample notice are not exclusive
means of compliance; rather, they are
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Federal Register / Vol. 65, No. 204 / Friday, October 20, 2000 / Proposed Rules
intended to provide guidance on how to
comply in specific situations.
The Agencies solicit comment on
whether to include additional or
different examples, and, more
fundamentally, on whether including
examples in the regulations is
appropriate and useful. Instead of
addressing specific fact situations
through such examples, the Agencies
could periodically issue interagency
staff commentaries or questions and
answers.
The Agencies note that an example
that mentions a particular activity does
not, by itself, authorize an institution to
engage in that activity. Any such
authority must have an independent
source.
Section .3 Definitions
Discussed below are a few key
definitions, including: ‘‘affiliate’’ (as
well as the related terms ‘‘company’’
and ‘‘control’’); ‘‘clear and
conspicuous’’; ‘‘opt out’’; ‘‘opt out
information’’; and ‘‘consumer report.’’
The proposal tracks the statutory
language referring to ‘‘transaction or
experience information,’’ but does not
define that term.
Affiliate
Several FCRA provisions apply to
information sharing with persons
‘‘related by common ownership or
affiliated by corporate control,’’ ‘‘related
by common ownership or affiliated by
common corporate control,’’ or
‘‘affiliated by common ownership or
common corporate control.’’ E.g., FCRA,
sections 603(d)(2), 615(b)(2), and
624(b)(2). Proposed paragraph (b)
defines ‘‘affiliate’’ to refer to all these
relationships between and among
companies, and clarifies that ‘‘related or
affiliated by common ownership or
affiliated by corporate control or
common corporate control’’ means
controlling, controlled by, or under
common control with another company.
Consistent with the definitions in the
privacy regulations, the proposal uses a
definition of ‘‘control’’ that applies
exclusively to the control of a
‘‘company,’’ and defines ‘‘company’’ to
include any corporation, limited
liability company, business trust,
general or limited partnership,
association, or similar organization. See
proposed paragraphs (e) (‘‘company’’)
and (i) (‘‘control’’). The definition of
‘‘company’’ omits some entities that are
‘‘persons’’ under the FCRA—
individuals, estates, cooperatives,
governments, and governmental
subdivisions or agencies. The Agencies,
however, are not aware of any
circumstances where ‘‘control’’ could be
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exercised over individuals, government
agencies, and other persons that do not
fit within the definition of ‘‘company.’’
Comment is solicited on whether the
proposed definition of ‘‘control’’ should
be expanded to apply to these
additional types of persons.
Clear and Conspicuous
Proposed paragraph (c) defines ‘‘clear
and conspicuous’’ to mean that a notice
must be reasonably understandable and
designed to call attention to the nature
and significance of the information it
contains. The proposed regulations do
not mandate the use of any particular
technique for making a notice clear and
conspicuous; instead, they give
institutions flexibility in determining
how to comply. An institution may
make its notice reasonably
understandable by, for example, using
short explanatory sentences or bullet
lists and avoiding legal or highly
technical business terminology
whenever possible. An institution may
design its notice to call attention to the
nature and significance of the
information in the notice by, for
example, using a plain-language
heading and a typeface and size that are
easy to read.
Paragraph (c) is consistent with the
‘‘clear and conspicuous’’ standard in the
privacy regulations. As such, it offers a
more detailed exposition of the standard
(particularly with respect to what makes
a notice ‘‘conspicuous’’) than some
other regulations, such as the Board’s
Regulation Z. However, laws other than
FCRA—for example, the Truth in
Lending Act—that require clear and
conspicuous disclosures, are beyond the
scope of this rulemaking. Accordingly,
the standard proposed here does not
affect disclosures required by those
laws.
The Agencies request comment on
whether institutions have any particular
concerns about compliance with FCRA’s
clear and conspicuous standard when
FCRA opt out notices are included with
the GLBA privacy provision notices.
Consumer Report
Proposed paragraph (g) parallels the
definition in section 603(d) of the
FCRA. Paragraph (g)(2)(ii) excludes from
the definition of ‘‘consumer report’’
communication among affiliates of a
report containing information solely as
to transactions or experiences between
the consumer and the person making
the report.2
2 Prior to the 1996 amendments to FCRA,
affiliated entities could not pool their transaction or
experience information in a common database
without being considered a consumer reporting
agency. Instead, each affiliate could disclose its
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Paragraph (g)(2)(iii) excludes any
communication of ‘‘opt out
information’’ if the conditions set out in
sections .4– .9 are satisfied. The
FCRA, as explained above, uses the term
‘‘other information’’ to refer to
information that it covers but that is not
transaction or experience information.
This proposal refers to ‘‘other
information’’ using the more descriptive
term ‘‘opt out information.’’ See
proposed paragraph (k).
Opt Out
Proposed paragraph (j) defines this
term to mean a direction by a consumer
that an institution not communicate opt
out information about the consumer to
one or more of the institution’s
affiliates.
Opt Out Information
As described above, the 1996
Amendments to FCRA excluded from
the definition of ‘‘consumer report’’ the
sharing of ‘‘other information’’ among
affiliates, so long as the consumer,
having been given notice and an
opportunity to opt out, did not opt out.
‘‘Other information’’ refers to
information that is covered by the FCRA
and that is not a report containing
information solely as to transactions or
experiences between the consumer and
the person making the report. The
proposed regulation uses the term ‘‘opt
out information’’ to describe this
category of information.
Proposed paragraph (k) defines opt
out information as information that (i)
bears on a consumer’s credit worthiness,
credit standing, credit capacity,
character, general reputation, personal
characteristics, or mode of living, (ii) is
used or expected to be used or collected
for one of the permissible purposes
listed in FCRA (e.g., credit transaction,
insurance underwriting, employment
purposes), and (iii) is not solely
transaction or experience information.
Section
.5(d) gives examples of
categories of information that qualify as
opt out information.
Section .4 Communication of Opt
Out Information to Affiliates
Proposed section .4 describes the
conditions that an institution must meet
to ensure that its communication of opt
out information to its affiliates do not
constitute consumer reports including
own transaction or experience information to
another affiliate directly only in the same manner
as an entity can disclose information to a
nonaffiliated third party. While transaction or
experience information has been excluded from the
definition of ‘‘consumer report’’ since the FCRA’s
initial passage, the 1996 amendments facilitated the
disclosure of such information among affiliates.
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the requirement that the institution
provide an opt out notice.
Section 603(d)(2)(A)(iii) of the FCRA
excludes from the definition of
‘‘consumer report’’ the sharing of opt
out information among affiliates if:
it is clearly and conspicuously disclosed to
the consumer that the information may be
communicated among such persons and the
consumer is given the opportunity, before the
time that the information is initially
communicated, to direct that such
information not be communicated among
such persons * * *.
Proposed section
.4 accordingly
provides that opt out information may
be communicated among affiliates
without the communication being a
consumer report if: (i) The institution
has provided an opt out notice; (ii) the
institution has given the consumer a
reasonable opportunity and means,
before the time that it communicates the
information, to opt out; and (iii) the
consumer has not opted out.
Mergers & Acquisitions
In a merger or acquisition situation,
the need to provide new opt out notices
to the customers of the entity that ceases
to exist will depend on whether the
notices previously given to those
customers accurately reflect the policies
and practices of the surviving entity. If
they do, the surviving entity will not be
required under the rule to provide new
notices.
Section .5 Contents of Opt Out
Notice
Proposed paragraph (a) provides that
an opt out notice must be clear and
conspicuous, and must accurately
explain: (i) The categories of opt out
information about the consumer that the
institution communicates; (ii) the
categories of affiliates to which the
institution communicates the
information; (iii) the consumer’s ability
to opt out; and (iv) the means to do so.
The Agencies invite comment on
whether financial institutions should
also have to disclose in their FCRA
notices how long a consumer has to
respond to the opt out notice before the
institution may begin disclosing
information about that consumer to its
affiliates, as well as the fact that a
consumer can opt out at any time. These
disclosures are not required in the
privacy regulations. The Agencies seek
comment on whether the benefits of the
additional disclosures would outweigh
the burdens, and, if so, whether the
regulation should require the
disclosures to state that a financial
institution will wait 30 days in every
instance before sharing consumer
information with affiliates (see proposed
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section .6, below, for additional
discussion on reasonable opportunity to
opt out).
Proposed paragraph (b) clarifies that
an institution’s notice may describe not
only the communications of opt out
information that the institution
currently plans to make to its affiliates,
but also the communications that it
reserves the right to make in the future.
Proposed paragraph (c) explains that an
institution may, but need not, provide
the consumer with the option of an opt
out that covers only part of the
information or certain affiliates. This
would enable an institution to give
consumers a menu of opt out choices if
it desires to do so.
Paragraph (d) explains how an
institution can satisfy the requirement
that it categorize the opt out information
that it communicates. Paragraph (d)(2)
gives examples of categories of opt out
information, such as information from a
consumer’s application, information
from a consumer report, information
obtained by verifying representations
made by a consumer, and information
provided by another person regarding
that person’s relationship with a
consumer. The first two categories
reflect the legislative history of the 1996
Amendments, which states in part that
the opt out provision ‘‘will clarify that
affiliates within a Holding Company
structure can share any application
information * * * and consumer
reports, consistent with the FCRA.’’ S.
Rep. No. 185, 104th Cong., 1st Sess. 18–
19 (1995). The other two categories
represent information that the Agencies
believe does not constitute transaction
or experience information when
communicated by the institution that
has received it. Paragraph (d)(3) gives a
non-exclusive list of examples of
specific items of opt out information
within each category, including a
consumer’s income, credit score or
credit history, open lines of credit,
employment history, marital status and
medical history.
Medical data are especially sensitive
for many consumers; if such data are
among the opt out information that an
institution communicates to its
affiliates, the institution satisfies the
requirement to categorize that
information only if it includes examples
of medical data that it intends to share.
The Agencies note that the items listed
in paragraph (d)(3) as examples of
information that would be included
within the categories of opt out
information are illustrative only. Those
items would not be considered opt out
information in cases where the
information is obtained from a source
other than those listed in paragraph
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(d)(2). Comment is requested as to the
appropriateness of these examples of
categories and items of opt out
information, and whether additional or
different examples should be used.
The descriptions of the categories of
information set out in proposed
paragraph (d)(2) differ somewhat from
those in section .6(c)(2) of the privacy
regulations. The agencies solicit
comment on the extent to which the
categories in (d)(2) can be treated as
consistent with similar categories in the
privacy regulations (such as disclosures
of information from consumer reporting
agencies) in order to reduce compliance
burden and consumer confusion.
Proposed paragraph (e) explains how
an institution can satisfy the
requirement that it categorize the
affiliates to which it communicates opt
out information.
Paragraph (f) cross-references the
sample notice in appendix A, which
presents a further illustration of the
content of an opt out notice.
Section .6 Reasonable Opportunity
to Opt Out
Proposed paragraph (a) of section
.6 states that financial institutions
will provide a reasonable opportunity to
opt out by providing a reasonable period
of time for the consumer to opt out from
the time that notice is delivered.
Proposed paragraph (b) sets out
examples of what is a reasonable period
of time when notices are provided in
person, by mail, or by electronic means.
Comment is requested on whether there
are other situations that would suggest
a different reasonable period of time
that the Agencies should note by
example. Proposed paragraph (c)
explains that a consumer may opt out at
any time.
Section .7 Reasonable Means of
Opting Out
Proposed paragraph (a) sets forth the
general rule that an institution provides
a reasonable means of opting out if it
provides a reasonably convenient
method to the consumer to opt out.
Examples of reasonable means of opting
out and unreasonable means are set out
in proposed paragraphs (b) and (c),
respectively. Proposed paragraph (d)
permits an institution to require each
consumer to opt out through a specific
means, as long as that means is
reasonable for that consumer.
Section .8 Delivery of Opt Out
Notices
Proposed paragraph (a) provides that
an institution must deliver an opt out
notice so that each consumer can
reasonably be expected to receive actual
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notice. As indicated by the examples
provided in proposed paragraph (b), this
is a lesser standard than actual notice.
For instance, if an institution mails a
printed copy of its notice to the last
known mailing address of an existing
customer, the institution has met its
obligation even if the customer has
changed addresses and never receives
the notice.
An institution may give notice in
writing or, if the consumer agrees,
electronically. For example, the
institution may e-mail its notice to a
customer that conducts electronic
transactions and has agreed to receive
electronic notice. The Agencies invite
comment on whether and how the
proposed rules governing
communications between a financial
institution and a consumer via an
electronic medium should be modified
in light of the Electronic Signatures in
Global and National Commerce Act (the
E-Sign Act).3
Proposed paragraph (c) explains that
oral notice alone does not comply with
the notice requirement; however, oral
notice may be provided in conjunction
with appropriate written or electronic
notice.
Proposed paragraph (d) explains that
an institution must provide the notice
so that the consumer can retain it or
obtain it at a later time, and gives
examples of retention or accessibility.
Proposed paragraph (e) permits an
institution to provide a joint opt out
notice with one or more of its affiliates
that are identified in the notice, as long
as the notice is accurate with respect to
each entity jointly issuing the notice.
Proposed paragraph (f)(1) sets out
rules that apply, notwithstanding any
other provision of the regulations, when
two or more consumers jointly obtain a
product or service from an institution
(referred to in the proposed regulation
as joint consumers), such as a joint
checking account. For example, an
institution may provide a single opt out
notice to joint accountholders. The
notice must indicate whether the
institution will consider an opt out by
a joint accountholder as an opt out by
all of the associated accountholders, or
whether each accountholder may opt
out separately. The institution may not
3 Congress recently enacted the E-Sign Act, Pub.
L. 106–229, which addresses the use of electronic
records and signatures for interstate and foreign
commerce. This legislation contains general rules
governing the use of electronic records for
providing required information to consumers (such
as disclosures and acknowledgments required by
the GLBA). The legal requirement that consumer
disclosures be in writing may be satisfied by an
electronic record if the consumer affirmatively
consents and certain other requirements of the ESign Act are met.
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require all accountholders to opt out
before honoring an opt out direction by
one of the joint accountholders.
Paragraph (f)(2) gives examples of these
rules.
Section .9 Revised Opt Out Notice
Proposed section
.9 addresses the
situation in which an institution has
provided a consumer with one or more
opt out notices but later decides to
communicate opt out information to its
affiliates other than described in those
notices. It explains that an institution
must send a revised opt out notice that
complies with section
.4, including
providing a reasonable means and
opportunity to opt out, and
communicating the information only if
the consumer has not opted out.
Section .10 Time by Which Opt Out
Must be Honored
Proposed section
.10 explains
that if an institution provides a
consumer with an opt out notice, and
the consumer opts out, the institution
must comply as soon as reasonably
practicable after receiving the
consumer’s direction. Comment is
solicited on whether the Agencies
should establish a fixed number of
days—for example, 30 days—that would
be deemed a ‘‘reasonably practicable’’
period of time for complying with a
consumer’s opt out direction.
Section .11 Duration of Opt Out
Proposed section
.11 provides
that an opt out continues to apply to the
information and affiliates described in
the applicable opt out notice until
revoked by the consumer in writing, or
if the consumer agrees, electronically, as
long as the consumer continues to have
a relationship with the institution. If the
consumer’s relationship with the
institution terminates, the opt out will
continue to apply to this information.
However, a new notice and opportunity
to opt out must be provided if the
consumer establishes a new relationship
with the institution.
Section .12 Prohibition Against
Discrimination
Proposed paragraph (a) reminds
institutions that they may not
‘‘discriminate against’’ a consumer who
is an ‘‘applicant’’ for credit because the
applicant opts out. The source of this
prohibition is the Equal Credit
Opportunity Act (ECOA; 15 U.S.C. 1691
et seq.), which bars discrimination on a
prohibited basis in any aspect of a credit
transaction; one prohibited basis is
exercising a right under the Consumer
Credit Protection Act, which includes
the FCRA. Proposed paragraph (b)
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provides examples of prohibited
discrimination against an applicant.
Paragraph (c) notes that the terms
‘‘applicant’’ and ‘‘discriminate against’’
have the meaning ascribed to these
terms in 12 CFR part 202.
Appendix A
Appendix A, which is part of these
regulations, contains a sample notice,
part or all of which may be used to
facilitate compliance with the notice
requirements. Although use of the
sample notice is not required,
institutions using it properly to provide
notices will be deemed to be in
compliance.
The Agencies solicit comment on all
aspects of the proposed regulations,
including but not limited to those
highlighted above.
III. FDIC’s Electronic Public Comment
Site
The FDIC has included a page on its
web site to facilitate the submission of
electronic comments in response to this
general solicitation (the EPC site). The
EPC site provides an alternative to the
written letter and may be a more
convenient way for you to submit your
comments. Commenting through the
EPC site will assist the FDIC to more
accurately and efficiently analyze
comments submitted electronically. If
you submit your comments through the
EPC site your comments will receive the
same consideration that they would
receive if submitted in hard copy to the
FDIC’s street address. Information
provided through the EPC site will be
used by the FDIC only to assist in its
analysis of the proposed regulation. The
FDIC will not use an individual’s name
or any other personal identifier of an
individual to retrieve records or
information submitted through the EPC
site. Like comments submitted in hard
copy to the FDIC’s street address, EPC
site comments will be made available in
their entirety (including the
commenter’s name and address if the
commenter chooses to provide them) for
public inspection.
The EPC site will be available on the
FDIC’s home page at http://
www.fdic.gov. You will be able to
provide comments directly on any of the
sections of the proposed regulation as
well as the specific questions that have
been asked in the preceding
Supplementary Information section.
You will also be able to view the
regulation and Supplementary
Information sections that related to your
comments directly on the site. Because
the GLBA authorizes promulgation of
this regulation, the FDIC encourages you
to provide written comments in the
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spaces provided. Written comments
enable the FDIC to thoughtfully
consider possible changes to the
proposed regulation.
The FDIC is also interested in your
feedback on the EPC site. We have
provided a space for you to comment on
the site itself. Answers to this question
will help the FDIC to evaluate the EPC
site for use in future rulemaking.
At the conclusion of the EPC site you
will have an opportunity to provide us
with your name, indicate whether you
are an individual, insured depository
institution, financial holding company,
community-based organization, trade
association, government agency, or
other, and provide the name of the
organization you represent, if
applicable. Whether you choose to
respond to these questions is entirely up
to you. Any responses received may
help the FDIC to better understand the
public comments it receives.
IV. Regulatory Analysis
Paperwork Reduction Act
The Agencies invite comment on: (1)
Whether the collections of information
contained in this notice of proposed
rulemaking are necessary for the proper
performance of each Agency’s functions,
including whether the information has
practical utility; (2) the accuracy of each
Agency’s estimate of the burden of the
proposed information collections; (3)
ways to enhance the quality, utility, and
clarity of the information to be
collected; (4) ways to minimize the
burden of the information collections on
respondents, including the use of
automated collection techniques or
other forms of information technology;
and (5) estimates of capital or start-up
costs and costs of operation,
maintenance, and purchases of services
to provide information. No person is
required to respond to these collections
of information unless the collections
display a currently valid Office of
Management and Budget (OMB) control
number. The Agencies are currently
requesting their respective control
numbers for these information
collections from OMB.
This proposed regulation contains
disclosure requirements for certain
financial institutions and their affiliates.
A financial institution that (a) has
affiliates, (b) does not wish to be
considered a consumer reporting
agency, and (c) wishes to share
consumer information (other than
transaction and experience information)
with its affiliates, must prepare and
provide a notice to all its consumers
advising them of their opportunity to
opt out of information sharing with
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companies in the institution’s corporate
family. 12 CFR
.4. If a financial
institution wishes to share information
in a way that is inconsistent with
notices previously given to consumers,
the institution must provide consumers
with revised notices. 12 CFR
.11.
The proposed regulation also contains
consumer reporting provisions. In order
for consumers to opt out, they must
respond to the institution’s opt out
notices. 12 CFR
.7. At any time
during their continued relationship with
the institution, consumers have the right
to change or update their opt out status
with the institution. 12 CFR
.10.
FCRA was amended to include
disclosure and opt out provisions in
1996, but the Agencies were prohibited
from issuing implementing regulations
until 1999. Thus, the collections of
information contained in this proposed
rule are not new requirements. During
the past three years, financial
institutions have developed systems,
policies, and procedures to bring
themselves into compliance with the
1996 FCRA amendments. In estimating
the burden associated with the
collections of information in this
proposed regulation, the Agencies took
into account the fact that FCRA-related
disclosure and opt out requirements
have already become a usual and
customary practice for covered
institutions. However, because the
proposed rule is more explicit and
detailed than the statute, some
institutions may need to revise their
disclosure policies or their notices, and
consumers may need to respond to the
revised notices. The burden associated
with these changes to current practice is
represented in the estimates below. In
estimating burden, the Agencies also
assumed that if a financial institution
provides an opt out notice under the
FCRA, that notice must be included in
certain notices mandated by the GLBA
privacy provisions, and will not be sent
out separately. The collection of
information requirements contained in
this notice of proposed rulemaking will
be submitted to the Office of
Management and Budget for review in
accordance with the Paperwork
Reduction Act of 1995 (44 U.S.C. 3507).
The estimated number of bank
respondents includes the total
institutions supervised by each of the
Agencies that have certain affiliate
relationships. The requirements of the
regulation only apply to institutions that
share opt out information with affiliates
that do not wish to be consumer
reporting agencies; therefore, the
Agencies cannot currently predict with
certainty how many of these institutions
will be subject to the rule. The analysis
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assumes that all institutions with
certain affiliates will in fact, choose to
share opt out information and thus be
subject to the rule.
The estimated number of consumers
who will receive opt out notices is the
sum of deposit and loan consumers, and
is derived from data in Board consumer
studies. Each Agency’s share of the total
number of consumers is based on the
share of total deposits, and consumer
and mortgage loans, held by institutions
supervised by the Agencies. Because
OTS collects different information about
consumer loans than the other Agencies,
OTS estimated the number of thrift
borrowers by dividing total consumer
loans outstanding by the average
balance, for different types of consumer
loans. The analysis assumes that
institutions will provide separate opt
out notices based on product lines such
as loans and deposit accounts, rather
than single, combined notices covering
all of the various relationships a
consumer may have with the institution.
The Agencies seek comment as to
whether institutions would likely send
separate or combined notices.
OCC: Comments on the collections of
information should be sent to the Office
of Management and Budget, Paperwork
Reduction Project (1557—to be
assigned), Washington, DC 20503, with
copies to Jessie Dunaway, Legislative
and Regulatory Activities Division
(1557—to be assigned), Office of the
Comptroller of the Currency, 250 E
Street, SW, Washington, DC 20219. The
likely respondents are national banks
that do not wish to be considered
consumer reporting agencies, but want
to share information (other than
transaction or experience information)
with their affiliates.
Estimated number of bank
respondents: 737.
Estimated average annual burden
hours per bank respondent: 8 hours.
Estimated number of consumer
respondents: 94,238,000.
Estimated average annual burden
hours per consumer respondent: 5
minutes.
Estimated total annual reporting
burden: 7,855,921 hours.
The number of consumer respondents
provided by the OCC represents a
conservative estimate based upon the
total number of consumers who will
receive an opt out notice. The OCC is
using these conservative estimates
because it lacks more precise data on
the number of consumers who will
exercise their opt out rights. The OCC
expects that the actual number of
consumer respondents will be lower
than the estimate provided above, and
invites comment on the number of
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consumers who will respond to the
FCRA opt out notices.
Board: In accordance with the
Paperwork Reduction Act of 1995 (44
U.S.C. 3506; 5 CFR 1320, appendix A.1),
the Board reviewed the notice of
proposed rulemaking under the
authority delegated to the Board by the
OMB. Comments on the collections of
information should be sent to Mary M.
West, Federal Reserve Board Clearance
Officer, Mail Stop 97, Board of
Governors of the Federal Reserve
System, Washington, DC 20551, with a
copy to the Office of Management and
Budget, Paperwork Reduction Project
(7100—to be assigned), Washington, DC
20503. The likely respondents are
member banks of the Federal Reserve
System (other than national banks),
branches and agencies of foreign banks
(other than Federal branches, Federal
agencies, and insured State branches of
foreign banks), commercial lending
companies owned or controlled by
foreign banks, and organizations
operating under section 25 or 25A of the
Federal Reserve Act, that do want to
share information (other than
transaction or experience information)
with their affiliates.
Estimated number of bank
respondents: 996.
Estimated average annual burden
hours per bank respondent: 8 hours.
Estimated number of consumer
respondents: 39,251,000.
Estimated average annual burden
hours per consumer respondent: five
minutes.
Estimated total annual reporting
burden: 3,278,885 hours.
FDIC: Comments on the collections of
information should be sent to Steven F.
Hanft, Office of the Executive Secretary,
Federal Deposit Insurance Corporation,
550 17th Street, NW., Washington, DC
20429, with a copy to the Office of
Management and Budget, Paperwork
Reduction Project (3064—to be
assigned), Washington, DC 20503. The
likely respondents are insured
nonmember banks with affiliates, that
do not wish to be considered consumer
reporting agencies, and do want to share
information (other than transaction or
experience information) with their
affiliates.
Estimated number of bank
respondents: 1,640.
Estimated average annual burden
hours per bank respondent: 8 hours.
Estimated number of consumer
respondents: 24,445,000.
Estimated average annual burden
hours per consumer respondent: five
minutes.
Estimated total annual reporting
burden: 2,049,389 hours.
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OTS: Comments on the collection of
information should be sent to the
Dissemination Branch (1550—to be
assigned), Office of Thrift Supervision,
1700 G Street, NW, Washington, DC
20552, with a copy to the Office of
Management and Budget, Paperwork
Reduction Project (1550—to be
assigned), Washington, DC 20503. The
likely respondents are savings
associations with affiliates that do not
wish to be considered consumer
reporting agencies, and do want to share
information (other than transaction or
experience information) with their
affiliates, and consumers.
Estimated number of thrift
respondents: 762.
Estimated average annual burden
hours per thrift respondent: 8 hours.
Estimated number of consumer
respondents: 49,925,225.
Estimated average annual burden
hours per consumer respondent: .0833
hours (5 minutes).
Estimated total annual reporting
burden: 4,164,867 hours.
Regulatory Flexibility Act
OCC: Pursuant to section 605(b) of the
Regulatory Flexibility Act (5 U.S.C. 601
et seq.), the OCC certifies that this
proposal will not have a significant
economic impact on a substantial
number of small entities. Financial
institutions have had to notify their
consumers of the right to opt out of
affiliate sharing of certain information
since 1997. This rulemaking provides
guidance to national banks concerning
how they may comply with the statutory
requirements, but requires no new type
of disclosure or opt out system. While
existing forms may need to be modified,
these modifications are unlikely to
result in a significant economic impact
on a substantial number of small
entities.
In addition, some of the requirements
in the proposed rule have been designed
to correspond to the requirements of the
privacy regulations. For example, under
both regulations, financial institutions,
in certain circumstances, must deliver
notices to consumers and to provide
consumers an opportunity to opt out of
certain information disclosures. This
proposed rule would allow financial
institutions to combine into one notice
the notice they must deliver under
FCRA and the notice that they must
deliver under the privacy regulations.
Also, institutions may combine their
consumers’ opt out responses into one
opt out response. By combining the
notices they deliver and the opt out
responses they process, financial
institutions will not need to produce
additional notices or to process
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additional opt out responses under this
rule. Because the proposed rule is
designed to minimize FCRA’s burden on
financial institutions, and because the
FCRA requirements have been effective
since 1997, the OCC believes that this
proposed rule will not have a significant
economic impact on a substantial
number of small entities. For these
reasons, a regulatory flexibility analysis
is not required.
Board: Pursuant to section 605(b) of
the Regulatory Flexibility Act (5 U.S.C.
601 et seq.), the Board certifies that the
proposed rule will not have a significant
economic impact on a substantial
number of small entities. As further
discussed below, the proposed rule
implements law that has been in effect
for some time, corresponds as much as
feasible to the requirements of the
Board’s Regulation P, would allow
institutions to combine privacy and
FCRA notices to consumers, and would
allow institutions to combine
consumers’ responses to those notices.
Accordingly, a regulatory flexibility
analysis is not required.
Since 1997, the FCRA has provided
that the term ‘‘consumer report’’ does
not include any communication of other
information (meaning information that
is not transaction or experience
information) among persons related by
common ownership or affiliated by
corporate control, if it is clearly and
conspicuously disclosed to the
consumer that the information may be
communicated among such persons and
the consumer is given the opportunity,
before the time that the information is
initially communicated, to direct that
such information not be communicated
among such persons. The proposed
regulations would implement this
provision and would provide guidance
to certain Board-regulated institutions
on how to comply, but would not
substantively change existing law. No
new type of disclosure or opt-out system
would be required. While existing forms
may need to be modified, these
modifications are unlikely to result in a
significant economic impact on a
substantial number of small entities.
Additionally, the proposed rule is
designed to correspond as much as
feasible to the requirements of
Regulation P, which governs the privacy
of consumer financial information. Both
regulations implement statutory
provisions for the delivery of
information-sharing opt out notices to
consumers. The proposed rule would
facilitate compliance by financial
institutions with the requirement to
provide privacy notices and the use of
opt out notices under the FCRA by
allowing the two notices to be combined
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in a single notice. Similarly, institutions
would be allowed to combine their
consumers’ opt out responses in a single
opt out response. By choosing to
combine the notices they deliver and
the opt out responses they process,
financial institutions will not need to
produce additional notices or to process
additional opt out responses under this
rule. For these reasons, a regulatory
flexibility analysis is not required.
FDIC: Pursuant to section 605(b) of
the Regulatory Flexibility Act (5 U.S.C.
601 et seq.), the FDIC certifies that the
proposed rule will not have a significant
economic impact on a substantial
number of small entities. This
conclusion is based on the following
facts. The FCRA has required financial
institutions to notify their consumers of
the right to opt out of affiliate sharing
of certain information since 1997.
However, prior to the GLBA, the
Agencies had no authority to issue rules
to provide financial institutions with
guidance to comply with the FCRA
requirements. This proposed
rulemaking does not substantively
change the existing statutory
requirements, but rather provides
guidance to financial institutions that
should minimize any burden associated
with complying with the subject FCRA
information sharing provisions. This
proposal requires no new type of
disclosure or opt out system. While
existing forms may need to be modified,
these modifications are unlikely to
result in a significant economic impact
on a substantial number of small
entities. The Agencies have attempted to
minimize any such economic impact by
including a sample notice, part or all of
which may be used to facilitate
compliance with the notice
requirements.
Further, this proposed rule is
designed to be consistent with the
requirements of the regulation
governing the privacy of consumer
financial information. Both rules
implement statutory requirements for
financial institutions, in certain
circumstances, to deliver notices to
consumers and to provide consumers an
opportunity to opt out of certain
information disclosures. The Agencies
have made the FCRA notice guidance
parallel to the privacy rule
requirements, thus facilitating the
delivery of a single notice to consumers.
Similarly, institutions may combine
their consumers’ opt out responses into
one opt out response. By combining the
notices they deliver and the opt out
responses they process, financial
institutions will not need to produce
additional notices or to process
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additional opt out responses under this
rule.
For the above reasons, the FDIC
believes that this proposed rule will not
have a significant economic impact on
a substantial number of small entities,
and a regulatory flexibility analysis is
not required.
OTS: Pursuant to section 605(b) of the
Regulatory Flexibility Act (5 U.S.C. 601
et seq.), the Director of OTS certifies
that this proposed rulemaking would
not have a significant economic impact
on a substantial number of small
entities. The FCRA has required thrifts
to notify their consumers of the right to
opt out of affiliate sharing of certain
information since 1997. However, prior
to GLBA, OTS did not have authority to
issue rules to provide thrifts with
guidance to comply with the FCRA.
This proposed rulemaking does not
substantively change or add to the
existing statutory requirements. It
merely provides thrifts with guidance to
help minimize any burden associated
with complying with the FCRA
information sharing provisions. This
proposal requires no new type of
disclosure or opt out system. While
existing forms may need to be modified,
these modifications are unlikely to
result in a significant economic impact
on a substantial number of small
entities. The Agencies have attempted to
minimize any such economic impact by
including a sample notice, part or all of
which thrifts may use to facilitate the
notice requirements.
Further, this proposed rule is
designed to be consistent with the
requirements of the regulation
governing the privacy of consumer
financial information, 12 CFR part 573.
Both rules implement statutory
requirements for financial institutions,
in certain circumstances, to deliver
notices to consumers and to provide
consumers an opportunity to opt out of
certain information disclosures. The
Agencies have made the FCRA notice
guidance parallel to the privacy rule
requirements, thus facilitating the
delivery of a single notice to consumers.
Similarly, institutions may combine a
consumer’s opt out responses into one
opt out response. By combining the
notices they deliver and the opt out
responses they process, financial
institutions will not need to produce
additional notices or to process
additional opt out responses under this
rule. For these reasons, a regulatory
flexibility analysis is not required.
OCC and OTS Executive Order 12866
Determination
The OCC and OTS each has
determined that its portion of the
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proposed rulemaking is not a significant
regulatory action under Executive Order
12866.
OCC and OTS Unfunded Mandates
Reform Act of 1995 Determination
Section 202 of the Unfunded
Mandates Reform Act of 1995, 2 U.S.C.
1532 (Unfunded Mandates Act) requires
that an agency prepare a budgetary
impact statement before promulgating a
rule that includes a Federal mandate
that may result in expenditure by State,
local, and tribal governments, in the
aggregate, or by the private sector, of
$100 million or more in any one year.
If a budgetary impact statement is
required, section 205 of the Unfunded
Mandates Act also requires an agency to
identify and consider a reasonable
number of regulatory alternatives before
promulgating a rule. The OCC and OTS
each has determined that this proposed
rule will not result in expenditures by
State, local, and tribal governments, or
by the private sector, of $100 million or
more. Accordingly, neither the OCC nor
the OTS has prepared a budgetary
impact statement or specifically
addressed the regulatory alternatives
considered.
V. Solicitation of Comments on Use of
Plain Language
Section 722 of the GLBA requires the
Federal banking agencies to use plain
language in all proposed and final rules
published after January 1, 2000. We
invite your comments on how to make
this proposed rule easier to understand.
For example:
• Have we organized the material to
suit your needs? If not, how could this
material be better organized?
• Are the requirements in the rule
clearly stated? If not, how could the rule
be more clearly stated?
• Do the regulations contain technical
language or jargon that is not clear? If
so, which language requires
clarification?
• Would a different format (grouping
and order of sections, use of headings,
paragraphing) make the regulation
easier to understand? If so, what
changes to the format would make the
regulation easier to understand?
• Would more, but shorter, sections
be better? If so, which sections should
be changed?
• What else could we do to make the
regulation easier to understand?
The Agencies solicit comment on
whether the inclusion of examples in
the regulation is appropriate. Elevating
the fact patterns to safe harbors in the
rule may generate certain problems over
time. For example, changes in
technology or practices may ultimately
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impact the fact patterns contained in the
examples and require changes to the
regulation. Are there alternative
methods to offer illustrative guidance of
the concepts portrayed by the examples?
List of Subjects
12 CFR Part 41
Banks, banking, Credit, National
banks, Reporting and recordkeeping
requirements.
12 CFR Part 222
Banks, banking, Credit, Federal
Reserve System, Reporting and
recordkeeping requirements, State
member banks.
12 CFR Part 334
Banks, banking, Credit, Reporting and
recordkeeping requirements.
12 CFR Part 571
Credit, Privacy, Reporting and
recordkeeping requirements, Savings
associations.
§ 41.2
12 CFR Chapter I
Authority and Issuance
For the reasons set forth in the joint
preamble, the OCC proposes to amend
chapter I of title 12 of the Code of
Federal Regulations by adding a new
part 41 to read as follows:
PART 41—FAIR CREDIT REPORTING
Sec.
41.1
41.2
41.3
41.4
Purpose and scope.
Examples.
Definitions.
Communication of opt out information
to affiliates.
41.5 Contents of opt out notice.
41.6 Reasonable opportunity to opt out.
41.7 Reasonable means of opting out.
41.8 Delivery of opt out notices.
41.9 Revised opt out notice.
41.10 Time by which opt out must be
honored.
41.11 Duration of opt out.
41.12 Prohibition against discrimination.
Appendix A to Part 41—Sample Notice
Authority: 12 U.S.C. 93a; 15 U.S.C. 1681s.
Purpose and scope.
(a) Purpose. This part governs the
collection, communication, and use, by
the institutions listed in paragraph (b)(2)
of this section, of certain information
bearing on a consumer’s credit
worthiness, credit standing, credit
capacity, character, general reputation,
personal characteristics, or mode of
living.
(b) Scope. (1) Information covered.
This part applies to information that is
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Examples.
The examples used in this part and
the sample notice in appendix A to this
part are not exclusive. Compliance with
an example or use of the sample notice,
to the extent applicable, constitutes
compliance with this part.
Office of the Comptroller of the
Currency
§ 41.1
used or expected to be used or collected
in whole or in part for the purpose of
serving as a factor in establishing a
consumer’s eligibility for credit,
insurance, employment, or any other
purpose authorized under section 604 of
the Fair Credit Reporting Act (15 U.S.C.
1681b).
(2) Institutions covered. This part
applies to national banks, and Federal
branches and Federal agencies of foreign
banks (collectively referred to as
‘‘bank’’).
(3) Relation to other laws. Nothing in
this part modifies, limits, or supersedes
the standards governing the privacy of
individually identifiable health
information promulgated by the
Secretary of Health and Human Services
under the authority of sections 262 and
264 of the Health Insurance Portability
and Accountability Act of 1996 (42
U.S.C. 1320d–1320d–8).
§ 41.3
Definitions.
As used in this part, unless the
context requires otherwise:
(a) Act means the Fair Credit
Reporting Act (15 U.S.C. 1681 et seq.).
(b) Affiliate. (1) In general. The term
means any company that is related or
affiliated by common ownership, or
affiliated by corporate control or
common corporate control, with another
company.
(2) Related or affiliated by common
ownership or affiliated by corporate
control or common corporate control.
This means controlling, controlled by,
or under common control with, another
company.
(c) Clear and conspicuous. (1) In
general. The term means that a notice is
reasonably understandable and is
designed to call attention to the nature
and significance of the information it
contains.
(2) Examples. (i) Reasonably
understandable. A bank makes its
notice reasonably understandable if it:
(A) Presents the information in the
notice in clear and concise sentences,
paragraphs, and sections;
(B) Uses short explanatory sentences
or bullet lists whenever possible;
(C) Uses definite, concrete, everyday
words and active voice whenever
possible;
(D) Avoids multiple negatives;
(E) Avoids legal and highly technical
business terminology whenever
possible; and
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(F) Avoids explanations that are
imprecise and are readily subject to
different interpretations.
(ii) Designed to call attention. A bank
designs its notice to call attention to the
nature and significance of the
information it contains if it:
(A) Uses a plain-language heading to
call attention to the notice;
(B) Uses a typeface and type size that
are easy to read;
(C) Provides wide margins and ample
line spacing;
(D) Uses boldface or italics for key
words; and
(E) In a form that combines the bank’s
notice with other information, uses
distinctive type sizes, styles, and
graphic devices, such as shading or
sidebars.
(iii) Notice on a web page. If a bank
provides a notice on a web page, the
bank designs its notice to call attention
to the nature and significance of the
information it contains if the bank:
(A) Places either the notice, or a link
that connects directly to the notice and
that is labeled appropriately to convey
the importance, nature, and relevance of
the notice, on a page that consumers
access often, such as a page on which
transactions are conducted;
(B) Uses text or visual cues to
encourage scrolling down the page if
necessary to view the entire notice; and
(C) Ensures that other elements on the
web page (such as text, graphics, links,
or sound) do not detract attention from
the notice.
(d) Communication includes written,
oral, and electronic communication;
provided that the term includes
electronic communication to a
consumer only if the consumer agrees to
receive the communication
electronically.
(e) Company means any corporation,
limited liability company, business
trust, general or limited partnership,
association, or similar organization.
(f) Consumer means an individual.
(g) Consumer report. (1) In general.
The term means any written, oral, or
other communication of any
information by a consumer reporting
agency bearing on a consumer’s credit
worthiness, credit standing, credit
capacity, character, general reputation,
personal characteristics, or mode of
living which is used or expected to be
used or collected in whole or in part for
the purpose of serving as a factor in
establishing the consumer’s eligibility
for:
(i) Credit or insurance to be used
primarily for personal, family, or
household purposes;
(ii) Employment purposes; or
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(iii) Any other purpose authorized
under section 604 of the Act (15 U.S.C.
1681b).
(2) Exclusions. The term does not
include:
(i) Any report containing information
solely as to transactions or experiences
between the consumer and the person
making the report;
(ii) Any communication of that
information among affiliates;
(iii) Any communication among
affiliates of opt out information if the
conditions in §§ 41.4 through 41.9 are
satisfied;
(iv) Any authorization or approval of
a specific extension of credit directly or
indirectly by the issuer of a credit card
or similar device;
(v) Any report in which a person who
has been requested by a third party to
make a specific extension of credit
directly or indirectly to a consumer
conveys his or her decision with respect
to such request, if the third party
advises the consumer of the name and
address of the person to whom the
request was made, and the person
makes the disclosures to the consumer
required under section 615 of the Act
(15 U.S.C. 1681m); or
(vi) A communication described in
section 603(o) of the Act (15 U.S.C.
1681a(o)).
(h) Consumer reporting agency means
any person which, for monetary fees,
dues or on a cooperative nonprofit basis,
regularly engages in whole or in part in
the practice of assembling or evaluating
consumer credit information or other
information on consumers for the
purpose of furnishing consumer reports
to third parties, and which uses any
means or facility of interstate commerce
for the purpose of preparing or
furnishing consumer reports.
(i) Control of a company means:
(1) Ownership, control, or power to
vote 25 percent or more of the
outstanding shares of any class of voting
security of the company, directly or
indirectly, or acting through one or
more other persons;
(2) Control in any manner over the
election of a majority of the directors,
trustees, or general partners (or
individuals exercising similar functions)
of the company; or
(3) The power to exercise, directly or
indirectly, a controlling influence over
the management or policies of the
company, as the Office of the
Comptroller of the Currency determines.
(j) Opt out means a direction by a
consumer that a bank not communicate
opt out information about the consumer
to one or more of its affiliates.
(k) Opt out information means
information that:
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(1) Bears on a consumer’s credit
worthiness, credit standing, credit
capacity, character, general reputation,
personal characteristics, or mode of
living;
(2) Is used or expected to be used or
collected in whole or in part to serve as
a factor in establishing the consumer’s
eligibility for credit or another purpose
listed in section 604 of the Act (15
U.S.C. 1681b); and
(3) Is not a report containing
information solely as to transactions or
experiences between the consumer and
the person reporting or communicating
the information.
(l) Person means any individual,
partnership, corporation, trust, estate,
cooperative, association, government or
governmental subdivision or agency, or
other entity.
§ 41.4 Communication of opt out
information to affiliates.
A bank’s communication to its
affiliates of opt out information about a
consumer is not a consumer report if:
(a) The bank has provided the
consumer with an opt out notice;
(b) The bank has given the consumer
a reasonable opportunity and means,
before the bank communicates the
information to its affiliates, to opt out;
and
(c) The consumer has not opted out.
§ 41.5
Contents of opt out notice.
(a) In general. An opt out notice must
be clear and conspicuous, and must
accurately explain:
(1) The categories of opt out
information about the consumer that a
bank communicates to its affiliates;
(2) The categories of affiliates to
which the bank communicates the
information;
(3) The consumer’s ability to opt out;
and
(4) A reasonable means for the
consumer to opt out.
(b) Future communications. A bank’s
notice may describe:
(1) Categories of opt out information
about the consumer that the bank
reserves the right to communicate to its
affiliates in the future but does not
currently communicate; and
(2) Categories of affiliates to which the
bank reserves the right in the future to
communicate, but to which the bank
does not currently communicate, opt
out information about the consumer.
(c) Partial opt out. A bank may allow
a consumer to select certain opt out
information or certain affiliates, with
respect to which the consumer wishes
to opt out.
(d) Examples of categories of
information that a bank communicates.
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(1) A bank satisfies the requirement to
categorize the opt out information that
it communicates if the bank lists the
categories in paragraph (d)(2) of this
section, as applicable, and a few
examples to illustrate the types of
information in each category. These
examples may include those in
paragraph (d)(3) of this section, if
applicable.
(2) Categories of opt out information
may include information:
(i) From a consumer’s application;
(ii) From a consumer credit report;
(iii) Obtained by verifying
representations made by a consumer; or
(iv) Provided by another person
regarding its employment, credit, or
other relationship with a consumer.
(3) Examples of information within a
category listed in paragraph (d)(2) of
this section include a consumer’s:
(i) Income;
(ii) Credit score or credit history with
others;
(iii) Open lines of credit with others;
(iv) Employment history with others;
(v) Marital status; and
(vi) Medical history.
(4) A bank does not satisfy the
requirement if it communicates or
reserves the right to communicate
individually identifiable health
information (as described in section
1171(6)(B) of the Social Security Act (42
U.S.C. 1320d(6)(B)) but omits
illustrative examples of this
information.
(e) Examples of categories of affiliates.
(1) A bank satisfies the requirement to
categorize the affiliates to which it
communicates opt out information if it
lists the categories in paragraph (e)(2) of
this section, as applicable, and a few
examples to illustrate the types of
affiliates in each category.
(2) Categories of affiliates may
include:
(i) Financial service providers; and
(ii) Non-financial companies.
(f) Sample notice. A sample notice is
included in appendix A to this part.
§ 41.6
Reasonable opportunity to opt out.
(a) In general. A bank provides a
reasonable opportunity to opt out if it
provides a reasonable period of time
following the delivery of the opt out
notice for the consumer to opt out.
(b) Examples of reasonable period of
time: (1) In person. A bank handdelivers an opt out notice to the
consumer and provides at least 30 days
from the date it delivered the notice.
(2) By mail. A bank mails an opt out
notice to a consumer and provides at
least 30 days from the date it mailed the
notice.
(3) By electronic means. A bank
notifies the consumer electronically,
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and it provides at least 30 days after the
date that the consumer acknowledges
receipt of the electronic notice.
(c) Continuing opportunity to opt out.
A consumer may opt out at any time.
§ 41.7
Reasonable means of opting out.
(a) General rule. A bank provides a
consumer with a reasonable means of
opting out if it provides a reasonably
convenient method to opt out.
(b) Reasonably convenient methods.
Examples of reasonably convenient
methods include:
(1) Designating check-off boxes in a
prominent position on the relevant
forms included with the opt out notice;
(2) Including a reply form together
with the opt out notice;
(3) Providing an electronic means to
opt out, such as a form that can be
electronically mailed or a process at the
bank’s web site, if the consumer agrees
to the electronic delivery of information;
or
(4) Providing a toll-free telephone
number that consumers may call to opt
out.
(c) Methods not reasonably
convenient. Examples of methods that
are not reasonably convenient include:
(1) Requiring a consumer to write his
or her own letter to a bank; or
(2) Referring in a revised notice to a
check-off box that a bank included with
a previous notice but that the bank does
not include with the revised notice.
(d) Requiring specific means of opting
out. A bank may require each consumer
to opt out through a specific means, as
long as that means is reasonable for that
consumer.
§ 41.8
Delivery of opt out notices.
(a) In general. A bank must deliver an
opt out notice so that each consumer
can reasonably be expected to receive
actual notice in writing or, if the
consumer agrees, electronically.
(b) Examples of expectation of actual
notice. (1) A bank may reasonably
expect that a consumer will receive
actual notice if it:
(i) Hand-delivers a printed copy of the
notice to the consumer;
(ii) Mails a printed copy of the notice
to the last known mailing address of the
consumer; or
(iii) For the consumer who conducts
transactions electronically, posts the
notice on its electronic site and requires
the consumer to acknowledge receipt of
the notice as a necessary step to
obtaining a particular product or
service;
(2) A bank may not reasonably expect
that a consumer will receive actual
notice if it:
(i) Only posts a sign in its branch or
office or generally publishes
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advertisements presenting its notice; or
(ii) Sends the notice via electronic mail
to a consumer who does not obtain a
product or service from the bank
electronically.
(c) Oral description insufficient. A
bank may not provide an opt out notice
solely by orally explaining the notice,
either in person or over the telephone.
(d) Retention or accessibility. (1) In
general. A bank must provide an opt out
notice so that it can be retained or
obtained at a later time by the consumer
in writing or, if the consumer agrees,
electronically.
(2) Examples of retention or
accessibility. A bank provides the notice
so that it can be retained or obtained at
a later time if the bank:
(i) Hand-delivers a printed copy of the
notice to the consumer;
(ii) Mails a printed copy of the notice
to the last known address of the
consumer upon request of the
consumer; or
(iii) Makes the bank’s current notice
available on a web site (or a link to
another web site) for the consumer who
obtains a product or service
electronically and who agrees to receive
the notice at the web site.
(e) Joint notice with affiliates. A bank
may provide a joint notice with one or
more affiliates as long as the notice
identifies each person providing it and
is accurate with respect to each.
(f) Joint relationships. (1) In general.
Notwithstanding any other provision in
this part, if two or more consumers
jointly obtain a product or service from
a bank (joint consumers), the following
rules apply:
(i) The bank may provide a single
notice to all of the joint consumers.
(ii) Any of the joint consumers has the
opportunity to opt out.
(iii) The bank may treat an opt out
direction by a joint consumer either as:
(A) Applying to all of the joint
consumers; or
(B) Applying to that particular joint
consumer.
(iv) The bank must explain in its opt
out notice which of the two policies set
forth in paragraph (f)(1)(iii) of this
section it will follow.
(v) If the bank follows the policy set
forth in paragraph (f)(1)(iii)(B) of this
section, by treating the opt out of a joint
consumer as applying to that particular
joint consumer, the bank must also
permit:
(A) A joint consumer to opt out on
behalf of other joint consumers; and
(B) One or more joint consumers to
notify the bank of their opt out
directions in a single response.
(vi) A bank may not require all joint
consumers to opt out before it
implements any opt out direction.
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(vii) If a bank receives an opt out by
a particular joint consumer that does not
apply to the others, the bank may
disclose information about the others as
long as no information is disclosed
about the consumer who opted out.
(2) Example. If consumers A and B,
who have different addresses, have a
joint checking account with a bank and
arrange for the bank to send statements
to A’s address, the bank may do any of
the following, but it must explain in its
opt out notice which opt out policy the
bank will follow. The bank may send a
single opt out notice to A’s address and:
(i) Treat an opt out direction by A as
applying to the entire account. If the
bank does so and A opts out, the bank
may not require B to opt out as well
before implementing A’s opt out
direction.
(ii) Treat A’s opt out direction as
applying to A only. If the bank does so,
it must also permit:
(A) A and B to opt out for each other;
and
(B) A and B to notify the bank of their
opt out directions in a single response
(such as on a single form) if they choose
to give separate opt out directions.
(iii) If A opts out only for A, and B
does not opt out, the bank may disclose
opt out information only about B, and
not about A and B jointly.
§ 41.9
Revised opt out notice.
If a bank has provided a consumer
with one or more opt out notices and
plans to communicate opt out
information to its affiliates about the
consumer other than as described in
those notices, the bank must provide the
consumer with a revised opt out notice
that complies with §§ 41.4 through 41.8.
§ 41.10 Time by which opt out must be
honored.
If a bank provides a consumer with an
opt out notice and the consumer opts
out, the bank must comply with the opt
out as soon as reasonably practicable
after the bank receives it.
§ 41.11
Duration of opt out.
An opt out remains effective until
revoked by the consumer in writing or
electronically, as long as the consumer
continues to have a relationship with
the bank. If the consumer’s relationship
with the bank terminates, the opt out
will continue to apply to this
information. However, a new notice and
opportunity to opt out must be provided
if the consumer establishes a new
relationship with the bank.
§ 41.12
Prohibition against discrimination.
(a) In general. If a consumer is an
applicant for credit, a bank must not
discriminate against the consumer if the
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consumer opts out of the bank’s
communication of opt out information
to it affiliates.
(b) Examples of discrimination
against an applicant. A bank
discriminates against an applicant if it:
(1) Denies the applicant credit
because the applicant opts out;
(2) Varies the terms of credit
adversely to the applicant such as by
providing less favorable pricing terms to
an applicant who opts out; or
(3) Applies more stringent credit
underwriting standards to the applicant
because the applicant opts out.
(c) Regulation B. The terms
‘‘applicant’’ and ‘‘discriminate against’’
in § 41.12 have the same meanings
ascribed to them in 12 CFR part 202.
opting out listed below 1]: [call us toll free at
{insert toll free number}]; or [visit our web
site at {insert web site address} and {provide
further instructions how to use the web site
option}]; or [e-mail us at {insert the e-mail
address}]; or [fill out and tear off the bottom
of this sheet and mail to the following
address: {insert address}]; or [check the
appropriate box on the attached form {attach
form} and mail to the following address:
{insert address}].
Note: Your direction in this paragraph
covers certain information about you that we
might otherwise share with our corporate
family. We may share other information
about you with our corporate family as
permitted by law.
Appendix A to Part 41—Sample Notice
Federal Reserve System
12 CFR Chapter II
This appendix contains a sample notice to
facilitate compliance with the notice
requirements of this part. An institution may
use applicable disclosures in this sample to
provide notices required by this part.
Notice of Your Opportunity To Opt Out of
Information Sharing With Companies in Our
Corporate Family
Information We Can Share With Our
Corporate Family About You—Unless You
Tell Us Not to
What Information: Unless you tell us not
to, [Financial Institution] may share with
companies in our corporate family
information about you including:
• Information we obtain from your
application, such as [provide illustrative
examples, such as ‘‘your income’’ or ‘‘your
marital status’’];
• Information we obtain from a consumer
report, such as [provide illustrative
examples, such as ‘‘your credit score or credit
history’’];
• Information we obtain to verify
representations made by you, such as
[provide illustrative examples, such as ‘‘your
open lines of credit’’]; and
• Information we obtain from a person
regarding its employment, credit, or other
relationship with you, such as [provide
illustrative examples, such as ‘‘your
employment history’’].
Shared With Whom: Companies in our
corporate family who may receive this
information are:
• Financial service providers, such as
[provide illustrative examples, such as
‘‘mortgage bankers, broker-dealers, and
insurance agents’’]; and
• Non-financial companies, such as
[provide illustrative examples, such as
‘‘retailers, direct marketers, airlines, and
publishers’’].
How To Tell Us Not To Share This
Information With Our Corporate Family
If you prefer that we not share this
information with companies in our corporate
family, you may direct us not to share this
information by doing the following [insert
one or more of the reasonable means of
VerDate 11<MAY>2000
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Dated: September 22, 2000.
John D. Hawke, Jr.,
Comptroller of the Currency.
Authority and Issuance
For the reasons set forth in the joint
preamble, chapter II of title 12 of the
Code of Federal Regulations is proposed
to be amended by adding a new part 222
to read as follows:
PART 222 FAIR CREDIT REPORTING
(REGULATION V)
Sec.
222.1 Purpose and scope.
222.2 Examples.
222.3 Definitions.
222.4 Communication of opt out
information to affiliates.
222.5 Contents of opt out notice.
222.6 Reasonable opportunity to opt out.
222.7 Reasonable means of opting out.
222.8 Delivery of opt out notices.
222.9 Revised opt out notice.
222.10 Time by which opt out must be
honored.
222.11 Duration of opt out.
222.12 Prohibition against discrimination.
Authority: 15 U.S.C. 1681s.
§ 222.1
Purpose and scope.
(a) Purpose. This part governs the
collection, communication, and use, by
the institutions listed in paragraph (b)(2)
of this section, of certain information
bearing on a consumer’s credit
worthiness, credit standing, credit
capacity, character, general reputation,
personal characteristics, or mode of
living.
(b) Scope. (1) Information covered.
This part applies to information that is
used or expected to be used or collected
in whole or in part for the purpose of
serving as a factor in establishing a
1 If the financial institution is using its web site
or an e-mail address as the only method by which
a consumer may opt out, the consumer must agree
to the electronic delivery of information.
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consumer’s eligibility for credit,
insurance, employment, or any other
purpose authorized under section 604 of
the Fair Credit Reporting Act (15 U.S.C.
1681b).
(2) Institutions covered. This part
applies to member banks of the Federal
Reserve System (other than national
banks), branches and agencies of foreign
banks (other than Federal branches,
Federal agencies, and insured State
branches of foreign banks), commercial
lending companies owned or controlled
by foreign banks, and organizations
operating under section 25 or 25A of the
Federal Reserve Act (12 U.S.C. 601–
604a, 611–631).
(3) Relation to other laws. Nothing in
this part modifies, limits, or supersedes
the standards governing the privacy of
individually identifiable health
information promulgated by the
Secretary of Health and Human Services
under the authority of sections 262 and
264 of the Health Insurance Portability
and Accountability Act of 1996 (42
U.S.C. 1320d–1320d–8).
§ 222.2
Examples.
The examples used in this part and
the sample notice in appendix A to this
part are not exclusive. Compliance with
an example or use of the sample notice,
to the extent applicable, constitutes
compliance with this part.
§ 222.3
Appendix A to Part 222—Sample Notice
63131
Definitions.
As used in this part, unless the
context requires otherwise:
(a) Act means the Fair Credit
Reporting Act (15 U.S.C. 1681 et seq.).
(b) Affiliate. (1) In general. The term
means any company that is related or
affiliated by common ownership, or
affiliated by corporate control or
common corporate control, with another
company.
(2) Related or affiliated by common
ownership or affiliated by corporate
control or common corporate control.
This means controlling, controlled by,
or under common control with, another
company.
(c) Clear and conspicuous. (1) In
general. The term means that a notice is
reasonably understandable and is
designed to call attention to the nature
and significance of the information it
contains.
(2) Examples. (i) Reasonably
understandable. You make your notice
reasonably understandable if you:
(A) Present the information in the
notice in clear and concise sentences,
paragraphs, and sections;
(B) Use short explanatory sentences or
bullet lists whenever possible;
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(C) Use definite, concrete, everyday
words and active voice whenever
possible;
(D) Avoid multiple negatives;
(E) Avoid legal and highly technical
business terminology whenever
possible; and
(F) Avoid explanations that are
imprecise and are readily subject to
different interpretations.
(ii) Designed to call attention. You
design your notice to call attention to
the nature and significance of the
information it contains if you:
(A) Use a plain-language heading to
call attention to the notice;
(B) Use a typeface and type size that
are easy to read;
(C) Provide wide margins and ample
line spacing;
(D) Use boldface or italics for key
words; and
(E) In a form that combines your
notice with other information, use
distinctive type sizes, styles, and
graphic devices, such as shading or
sidebars.
(iii) Notice on a web page. If you
provide a notice on a web page, you
design your notice to call attention to
the nature and significance of the
information it contains if you:
(A) Place either the notice, or a link
that connects directly to the notice and
that is labeled appropriately to convey
the importance, nature, and relevance of
the notice, on a page that consumers
access often, such as a page on which
transactions are conducted;
(B) Use text or visual cues to
encourage scrolling down the page if
necessary to view the entire notice; and
(C) Ensure that other elements on the
web page (such as text, graphics, links,
or sound) do not detract attention from
the notice.
(d) Communication includes written,
oral, and electronic communication;
provided that the term includes
electronic communication to a
consumer only if the consumer agrees to
receive the communication
electronically.
(e) Company means any corporation,
limited liability company, business
trust, general or limited partnership,
association, or similar organization.
(f) Consumer means an individual.
(g) Consumer report. (1) In general.
The term means any written, oral, or
other communication of any
information by a consumer reporting
agency bearing on a consumer’s credit
worthiness, credit standing, credit
capacity, character, general reputation,
personal characteristics, or mode of
living which is used or expected to be
used or collected in whole or in part for
the purpose of serving as a factor in
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establishing the consumer’s eligibility
for:
(i) Credit or insurance to be used
primarily for personal, family, or
household purposes;
(ii) Employment purposes; or
(iii) Any other purpose authorized
under section 604 of the Act (15 U.S.C.
1681b).
(2) Exclusions. The term does not
include:
(i) Any report containing information
solely as to transactions or experiences
between the consumer and the person
making the report;
(ii) Any communication of that
information among affiliates;
(iii) Any communication among
affiliates of opt out information if the
conditions in §§ 222.4 through 222.9 are
satisfied;
(iv) Any authorization or approval of
a specific extension of credit directly or
indirectly by the issuer of a credit card
or similar device;
(v) Any report in which a person who
has been requested by a third party to
make a specific extension of credit
directly or indirectly to a consumer
conveys his or her decision with respect
to such request, if the third party
advises the consumer of the name and
address of the person to whom the
request was made, and the person
makes the disclosures to the consumer
required under section 615 of the Act
(15 U.S.C. 1681m); or
(vi) A communication described in
section 603(o) of the Act (15 U.S.C.
1681a(o)).
(h) Consumer reporting agency means
any person which, for monetary fees,
dues or on a cooperative nonprofit basis,
regularly engages in whole or in part in
the practice of assembling or evaluating
consumer credit information or other
information on consumers for the
purpose of furnishing consumer reports
to third parties, and which uses any
means or facility of interstate commerce
for the purpose of preparing or
furnishing consumer reports.
(i) Control of a company means:
(1) Ownership, control, or power to
vote 25 percent or more of the
outstanding shares of any class of voting
security of the company, directly or
indirectly, or acting through one or
more other persons;
(2) Control in any manner over the
election of a majority of the directors,
trustees, or general partners (or
individuals exercising similar functions)
of the company;
(3) The power to exercise, directly or
indirectly, a controlling influence over
the management or policies of the
company, as the Board determines.
(j) Opt out means a direction by a
consumer that you not communicate opt
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out information about the consumer to
one or more of your affiliates.
(k) Opt out information means
information that:
(1) Bears on a consumer’s credit
worthiness, credit standing, credit
capacity, character, general reputation,
personal characteristics, or mode of
living;
(2) Is used or expected to be used or
collected in whole or in part to serve as
a factor in establishing the consumer’s
eligibility for credit or another purpose
listed in section 604 of the Act (15
U.S.C. 1681b); and
(3) Is not a report containing
information solely as to transactions or
experiences between the consumer and
the person reporting or communicating
the information.
(1) Person means any individual,
partnership, corporation, trust, estate,
cooperative, association, government or
governmental subdivision or agency, or
other entity.
(m) You means a member bank of the
Federal Reserve System (other than a
national bank), a branch or agency of a
foreign bank (other than a Federal
branch, Federal agency, or insured State
branch of a foreign bank), a commercial
lending company owned or controlled
by a foreign bank, or an organization
operating under section 25 or 25A of the
Federal Reserve Act (12 U.S.C. 601–
604a, 611–631).
§ 222.4 Communication of opt out
information to affiliates.
Your communication to your affiliates
of opt out information about a consumer
is not a consumer report if:
(a) You have provided the consumer
with an opt out notice;
(b) You have given the consumer a
reasonable opportunity and means,
before you communicate the
information to your affiliates, to opt out;
and
(c) The consumer has not opted out.
§ 222.5
Contents of opt out notice.
(a) In general. An opt out notice must
be clear and conspicuous, and must
accurately explain:
(1) The categories of opt out
information about the consumer that
you communicate to your affiliates;
(2) The categories of affiliates to
which you communicate the
information;
(3) The consumer’s ability to opt out;
and
(4) A reasonable means for the
consumer to opt out.
(b) Future communications. Your
notice may describe:
(1) Categories of opt out information
about the consumer that you reserve the
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right to communicate to your affiliates
in the future but do not currently
communicate; and
(2) Categories of affiliates to which
you reserve the right in the future to
communicate, but to which you do not
currently communicate, opt out
information about the consumer.
(c) Partial opt out. You may allow a
consumer to select certain opt out
information or certain affiliates, with
respect to which the consumer wishes
to opt out.
(d) Examples of categories of
information that you communicate. (1)
You satisfy the requirement to
categorize the opt out information that
you communicate if you list the
categories in paragraph (d)(2) of this
section, as applicable, and a few
examples to illustrate the types of
information in each category. These
examples may include those in
paragraph (d)(3) of this section, if
applicable.
(2) Categories of opt out information
may include information:
(i) From a consumer’s application;
(ii) From a consumer credit report;
(iii) Obtained by verifying
representations made by a consumer; or
(iv) Provided by another person
regarding its employment, credit, or
other relationship with a consumer.
(3) Examples of information within a
category listed in paragraph (d)(2) of
this section include a consumer’s:
(i) Income;
(ii) Credit score or credit history with
others;
(iii) Open lines of credit with others;
(iv) Employment history with others;
(v) Marital status; and
(vi) Medical history.
(4) You do not satisfy the requirement
if you communicate or reserve the right
to communicate individually
identifiable health information (as
described in section 1171(6)(B) of the
Social Security Act (42 U.S.C.
1320d(6)(B)) but omit illustrative
examples of this information.
(e) Examples of categories of affiliates.
(1) You satisfy the requirement to
categorize the affiliates to which you
communicate opt out information if you
list the categories in paragraph (e)(2) of
this section, as applicable, and a few
examples to illustrate the types of
affiliates in each category.
(2) Categories of affiliates may
include:
(i) Financial service providers; and
(ii) Non-financial companies.
(f) Sample notice. A sample notice is
included in appendix A to this part.
§ 222.6
Reasonable opportunity to opt out.
(a) In general. You provide a
reasonable opportunity to opt out if you
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63133
(ii) Mail a printed copy of the notice
to the last known mailing address of the
consumer; or
(iii) For the consumer who conducts
transactions electronically, post the
notice on your electronic site and
require the consumer to acknowledge
receipt of the notice as a necessary step
to obtaining a particular product or
service;
(2) You may not reasonably expect
that a consumer will receive actual
notice if you:
(i) Only post a sign in your branch or
office or generally publish
advertisements presenting your notice;
or
(ii) Send the notice via electronic mail
to a consumer who does not obtain a
product or service from you
§ 222.7 Reasonable means of opting out.
electronically.
(c) Oral description insufficient. You
(a) General rule. You provide a
may not provide an opt out notice solely
consumer with a reasonable means of
by orally explaining the notice, either in
opting out if you provide a reasonably
person or over the telephone.
convenient method to opt out.
(d) Retention or accessibility. (1) In
(b) Reasonably convenient methods.
general. You must provide an opt out
Examples of reasonably convenient
notice so that it can be retained or
methods include:
obtained at a later time by the consumer
(1) Designating check-off boxes in a
in writing or, if the consumer agrees,
prominent position on the relevant
electronically.
forms included with the opt out notice;
(2) Examples of retention or
(2) Including a reply form together
accessibility. You provide the notice so
with the opt out notice;
that it can be retained or obtained at a
(3) Providing an electronic means to
later time if you:
opt out, such as a form that can be
(i) Hand-deliver a printed copy of the
electronically mailed or a process at
notice to the consumer;
your web site, if the consumer agrees to
(ii) Mail a printed copy of the notice
the electronic delivery of information;
to the last known address of the
or
consumer upon request of the
(4) Providing a toll-free telephone
consumer; or
number that consumers may call to opt
(iii) Make your current notice
out.
available on a web site (or a link to
(c) Methods not reasonably
another web site) for the consumer who
convenient. Examples of methods that
obtains a product or service
are not reasonably convenient include:
electronically and who agrees to receive
(1) Requiring a consumer to write his
the notice at the web site.
or her own letter to you; or
(e) Joint notice with affiliates. You
(2) Referring in a revised notice to a
may provide a joint notice with one or
check-off box that you included with a
more affiliates as long as the notice
previous notice but that you do not
identifies each person providing it and
include with the revised notice.
is accurate with respect to each.
(d) Requiring specific means of opting
(f) Joint relationships. (1) In general.
out. You may require each consumer to
Notwithstanding any other provision in
opt out through a specific means, as
this part, if two or more consumers
long as that means is reasonable for that jointly obtain a product or service from
consumer.
you (joint consumers), the following
rules apply:
§ 222.8 Delivery of opt out notices.
(i) You may provide a single notice to
(a) In general. You must deliver an opt all of the joint consumers.
out notice so that each consumer can
(ii) Any of the joint consumers has the
reasonably be expected to receive actual opportunity to opt out.
notice in writing or, if the consumer
(iii) You may treat an opt out
agrees, electronically.
direction by a joint consumer either as:
(b) Examples of expectation of actual
(A) Applying to all of the joint
notice. (1) You may reasonably expect
consumers; or
that a consumer will receive actual
(B) Applying to that particular joint
notice if you:
consumer.
(iv) You must explain in your opt out
(i) Hand-deliver a printed copy of the
notice which of the two policies set
notice to the consumer;
provide a reasonable period of time
following the delivery of the opt out
notice for the consumer to opt out.
(b) Examples of reasonable period of
time: (1) In person. You hand-deliver an
opt out notice to the consumer and
provide at least 30 days from the date
you delivered the notice.
(2) By mail. You mail an opt out
notice to a consumer and provide at
least 30 days from the date you mailed
the notice.
(3) By electronic means. You notify
the consumer electronically, and you
provide at least 30 days after the date
that the consumer acknowledges receipt
of the electronic notice.
(c) Continuing opportunity to opt out.
A consumer may opt out at any time.
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forth in paragraph (f)(1)(iii) of this
section you will follow.
(v) If you follow the policy set forth
in paragraph (f)(1)(iii)(B) of this section,
by treating the opt out of a joint
consumer as applying to that particular
joint consumer, you must also permit:
(A) A joint consumer to opt out on
behalf of other joint consumers; and
(B) One or more joint consumers to
notify you of their opt out directions in
a single response.
(vi) You may not require all joint
consumers to opt out before you
implement any opt out direction.
(vii) If you receive an opt out by a
particular joint consumer that does not
apply to the others, you may disclose
information about the others as long as
no information is disclosed about the
consumer who opted out.
(2) Example. If consumers A and B,
who have different addresses, have a
joint checking account with you and
arrange for you to send statements to A’s
address, you may do any of the
following, but you must explain in your
opt out notice which opt out policy you
will follow. You may send a single opt
out notice to A’s address and:
(i) Treat an opt out direction by A as
applying to the entire account. If you do
so and A opts out, you may not require
B to opt out as well before
implementing A’s opt out direction.
(ii) Treat A’s opt out direction as
applying to A only. If you do so, you
must also permit:
(A) A and B to opt out for each other;
and
(B) A and B to notify you of their opt
out directions in a single response (such
as on a single form) if they choose to
give separate opt out directions.
(iii) If A opts out only for A, and B
does not opt out, you may disclose opt
out information only about B, and not
about A and B jointly.
§ 222.9
Revised opt out notice.
If you have provided a consumer with
one or more opt out notices and plan to
communicate opt out information to
your affiliates about the consumer other
than as described in those notices, you
must provide the consumer with a
revised opt out notice that complies
with §§ 222.4 through 222.8.
§ 222.10 Time by which opt out must be
honored.
If you provide a consumer with an opt
out notice and the consumer opts out,
you must comply with the opt out as
soon as reasonably practicable after you
receive it.
§ 222.11
Duration of opt out.
An opt out remains effective until
revoked by the consumer in writing or
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electronically, as long as the consumer
continues to have a relationship with
you. If the consumer’s relationship with
you terminates, the opt out will
continue to apply to this information.
However, a new notice and opportunity
to opt out must be provided if the
consumer establishes a new relationship
with you.
§ 222.12 Prohibition against
discrimination.
(a) In general. If a consumer is an
applicant for credit, you must not
discriminate against the consumer if the
consumer opts out of your
communication of opt out information
to your affiliates.
(b) Examples of discrimination
against an applicant. You discriminate
against an applicant if you:
(1) Deny the applicant credit because
the applicant opts out;
(2) Vary the terms of credit adversely
to the applicant such as by providing
less favorable pricing terms to an
applicant who opts out; or
(3) Apply more stringent credit
underwriting standards to the applicant
because the applicant opts out.
(c) Regulation B. The terms
‘‘applicant’’ and ‘‘discriminate against’’
in § 222.12 have the same meanings
ascribed to them in 12 CFR part 202.
Appendix A to Part 222—Sample
Notice
This appendix contains a sample notice to
facilitate compliance with the notice
requirements of this part. An institution may
use applicable disclosures in this sample to
provide notices required by this part.
Notice of Your Opportunity to Opt Out of
Information Sharing With Companies in Our
Corporate Family
Information We Can Share With Our
Corporate Family About You—Unless You
Tell Us Not To
What Information: Unless you tell us not
to, [Financial Institution] may share with
companies in our Corporate family
information about you including:
• Information we obtain from your
application, such as [provide illustrative
examples, such as ‘‘your income’’ or ‘‘your
marital status’’];
• Information we obtain from a consumer
report, such as [provide illustrative examples,
such as ‘‘your credit score or credit history’’];
• Information we obtain to verify
representations made by you, such as
[provide illustrative examples, such as ‘‘your
open lines of credit’’]; and
• Information we obtain from a person
regarding its employment, credit, or other
relationship with you, such as [provide
illustrative examples, such as ‘‘your
employment history’’].
Shared With Whom: Companies in our
corporate family who may receive this
information are:
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• Financial service providers, such as
[provide illustrative examples, such as
‘‘mortgage bankers, broker-dealers, and
insurance agents’’]; and
• Non-financial companies, such as
[provide illustrative examples, such as
‘‘retailers, direct marketers, airlines, and
publishers’’].
How To Tell Us Not To Share This
Information With Our Corporate Family
If you prefer that we not share this
information with companies in our corporate
family, you may direct us not to share this
information by doing the following [insert
one or more of the reasonable means of
opting out listed below 1]: [call us toll free at
{insert toll free number}]; or [visit our web
site at {insert web site address} and {provide
further instructions how to use the web site
option}]; or [e-mail us at {insert the e-mail
address}]; or [fill out and tear off the bottom
of this sheet and mail to the following
address: {insert address}]; or [check the
appropriate box on the attached form {attach
form} and mail to the following address:
{insert address}].
Note: Your direction in this paragraph
covers certain information about you that we
might otherwise share with our corporate
family. We may share other information
about you with our corporate family as
permitted by law.
By order of the Board of Governors of the
Federal Reserve System, October 11, 2000.
Jennifer J. Johnson,
Secretary of the Board.
Federal Deposit Insurance Corporation
12 CFR Chapter III
Authority and Issuance
For the reasons set out in the joint
preamble, chapter III of title 12 of the
Code of Federal Regulations is proposed
to be amended by adding a new part 334
to read as follows:
PART 334—FAIR CREDIT REPORTING
Sec.
334.1 Purpose and scope.
334.2 Examples.
334.3 Definitions.
334.4 Communication of opt out
information to affiliates.
334.5 Contents of opt out notice.
334.6 Reasonable opportunity to opt out.
334.7 Reasonable means of opting out.
334.8 Delivery of opt out notices.
334.9 Revised opt out notice.
334.10 Time by which opt out must be
honored.
334.11 Duration of opt out.
334.12 Prohibition against discrimination.
Appendix A to Part 222—Sample Notice
Authority: 15 U.S.C. 1681s; 12 U.S.C.
1819(a)(Tenth).
1 If the financial institution is using its web site
or an e-mail address as the only method by which
a consumer may opt out, the consumer must agree
to the electronic delivery of information.
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§ 334.1
Purpose and scope.
(a) Purpose. This part governs the
collection, communication, and use, by
the institutions listed in paragraph (b)(2)
of this section, of certain information
bearing on a consumer’s credit
worthiness, credit standing, credit
capacity, character, general reputation,
personal characteristics, or mode of
living.
(b) Scope. (1) Information covered.
This part applies to information that is
used or expected to be used or collected
in whole or in part for the purpose of
serving as a factor in establishing a
consumer’s eligibility for credit,
insurance, employment, or any other
purpose authorized under section 604 of
the Fair Credit Reporting Act (15 U.S.C.
1681b).
(2) Institutions covered. This part
applies to banks insured by the FDIC
(other than members of the Federal
Reserve System) and insured state
branches of foreign banks.
(3) Relation to other laws. Nothing in
this part modifies, limits, or supersedes
the standards governing the privacy of
individually identifiable health
information promulgated by the
Secretary of Health and Human Services
under the authority of sections 262 and
264 of the Health Insurance Portability
and Accountability Act of 1996 (42
U.S.C. 1320d–1320d–8).
§ 334.2
Examples.
The examples used in this part and
the sample notice in appendix A to this
part are not exclusive. Compliance with
an example or use of the sample notice,
to the extent applicable, constitutes
compliance with this part.
§ 334.3
Definitions.
As used in this part, unless the
context requires otherwise:
(a) Act means the Fair Credit
Reporting Act (15 U.S.C. 1681 et seq.).
(b) Affiliate. (1) In general. The term
means any company that is related or
affiliated by common ownership, or
affiliated by corporate control or
common corporate control, with another
company.
(2) Related or affiliated by common
ownership or affiliated by corporate
control or common corporate control.
This means controlling, controlled by,
or under common control with, another
company.
(c) Clear and conspicuous. (1) In
general. The term means that a notice is
reasonably understandable and is
designed to call attention to the nature
and significance of the information it
contains.
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(2) Examples. (i) Reasonably
understandable. You make your notice
reasonably understandable if you:
(A) Present the information in the
notice in clear and concise sentences,
paragraphs, and sections;
(B) Use short explanatory sentences or
bullet lists whenever possible;
(C) Use definite, concrete, everyday
words and active voice whenever
possible;
(D) Avoid multiple negatives;
(E) Avoid legal and highly technical
business terminology whenever
possible; and
(F) Avoid explanations that are
imprecise and are readily subject to
different interpretations.
(ii) Designed to call attention. You
design your notice to call attention to
the nature and significance of the
information it contains if you:
(A) Use a plain-language heading to
call attention to the notice;
(B) Use a typeface and type size that
are easy to read;
(C) Provide wide margins and ample
line spacing;
(D) Use boldface or italics for key
words; and
(E) In a form that combines your
notice with other information, use
distinctive type sizes, styles, and
graphic devices, such as shading or
sidebars.
(iii) Notice on a web page. If you
provide a notice on a web page, you
design your notice to call attention to
the nature and significance of the
information it contains if:
(A) You place either the notice, or a
link that connects directly to the notice
and that is labeled appropriately to
convey the importance, nature, and
relevance of the notice, on a page that
consumers access often, such as a page
on which transactions are conducted;
(B) You use text or visual cues to
encourage scrolling down the page if
necessary to view the entire notice; and
(C) You ensure that other elements on
the web page (such as text, graphics,
links, or sound) do not detract attention
from the notice.
(d) Communication includes written,
oral, and electronic communication;
provided that the term includes
electronic communication to a
consumer only if the consumer agrees to
receive the communication
electronically.
(e) Company means any corporation,
limited liability company, business
trust, general or limited partnership,
association, or similar organization.
(f) Consumer means an individual.
(g) Consumer report. (1) In general.
The term means any written, oral, or
other communication of any
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information by a consumer reporting
agency bearing on a consumer’s credit
worthiness, credit standing, credit
capacity, character, general reputation,
personal characteristics, or mode of
living which is used or expected to be
used or collected in whole or in part for
the purpose of serving as a factor in
establishing the consumer’s eligibility
for:
(i) Credit or insurance to be used
primarily for personal, family, or
household purposes;
(ii) Employment purposes; or
(iii) Any other purpose authorized
under section 604 of the Act (15 U.S.C.
1681b).
(2) Exclusions. The term does not
include:
(i) Any report containing information
solely as to transactions or experiences
between the consumer and the person
making the report;
(ii) Any communication of that
information among affiliates;
(iii) Any communication among
affiliates of opt out information if the
conditions in §§ 334.4 through 334.9 are
satisfied;
(iv) Any authorization or approval of
a specific extension of credit directly or
indirectly by the issuer of a credit card
or similar device;
(v) Any report in which a person who
has been requested by a third party to
make a specific extension of credit
directly or indirectly to a consumer
conveys his or her decision with respect
to such request, if the third party
advises the consumer of the name and
address of the person to whom the
request was made, and the person
makes the disclosures to the consumer
required under section 615 of the Act
(15 U.S.C. 1681m); or
(vi) A communication described in
section 603(o) of the Act (15 U.S.C.
1681a(o)).
(h) Consumer reporting agency means
any person which, for monetary fees,
dues or on a cooperative nonprofit basis,
regularly engages in whole or in part in
the practice of assembling or evaluating
consumer credit information or other
information on consumers for the
purpose of furnishing consumer reports
to third parties, and which uses any
means or facility of interstate commerce
for the purpose of preparing or
furnishing consumer reports.
(i) Control of a company means:
(1) Ownership, control, or power to
vote 25 percent or more of the
outstanding shares of any class of voting
security of the company, directly or
indirectly, or acting through one or
more other persons;
(2) Control in any manner over the
election of a majority of the directors,
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trustees, or general partners (or
individuals exercising similar functions)
of the company; or
(3) The power to exercise, directly or
indirectly, a controlling influence over
the management or policies of the
company, as the FDIC determines.
(j) Opt out means a direction by a
consumer that you not communicate opt
out information about the consumer to
one or more of your affiliates.
(k) Opt out information means
information that:
(1) Bears on a consumer’s credit
worthiness, credit standing, credit
capacity, character, general reputation,
personal characteristics, or mode of
living;
(2) Is used or expected to be used or
collected in whole or in part to serve as
a factor in establishing the consumer’s
eligibility for credit or another purpose
listed in section 604 of the Act (15
U.S.C. 1681b); and
(3) Is not a report containing
information solely as to transactions or
experiences between the consumer and
the person reporting or communicating
the information.
(l) Person means any individual,
partnership, corporation, trust, estate,
cooperative, association, government or
governmental subdivision or agency, or
other entity.
(m) You means banks insured by the
FDIC (other than members of the
Federal Reserve System) and insured
state branches of foreign banks.
§ 334.4 Communication of opt out
information to affiliates.
Your communication to your affiliates
of opt out information about a consumer
is not a consumer report if:
(a) You have provided the consumer
with an opt out notice;
(b) You have given the consumer a
reasonable opportunity and means,
before you communicate the
information to your affiliates, to opt out;
and
(c) The consumer has not opted out.
§ 334.5
Contents of opt out notice.
(a) In general. An opt out notice must
be clear and conspicuous, and must
accurately explain:
(1) The categories of opt out
information about the consumer that
you communicate to your affiliates;
(2) The categories of affiliates to
which you communicate the
information;
(3) The consumer’s ability to opt out;
and
(4) A reasonable means for the
consumer to opt out.
(b) Future communications. Your
notice may describe:
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(1) Categories of opt out information
about the consumer that you reserve the
right to communicate to your affiliates
in the future but do not currently
communicate; and
(2) Categories of affiliates to which
you reserve the right in the future to
communicate, but to which you do not
currently communicate, opt out
information about the consumer.
(c) Partial opt out. You may allow a
consumer to select certain opt out
information or certain affiliates, with
respect to which the consumer wishes
to opt out.
(d) Examples of categories of
information that you communicate. (1)
You satisfy the requirement to
categorize the opt out information that
you communicate if you list the
categories in paragraph (d)(2) of this
section, as applicable, and a few
examples to illustrate the types of
information in each category. These
examples may include those in
paragraph (d)(3) of this section, if
applicable.
(2) Categories of opt out information
may include information:
(i) From a consumer’s application;
(ii) From a consumer credit report;
(iii) Obtained by verifying
representations made by a consumer;
and
(iv) Provided by another person
regarding its employment, credit, or
other relationship with a consumer.
(3) Examples of information within a
category listed in paragraph (d)(2) of
this section include a consumer’s:
(i) Income;
(ii) Credit score or credit history with
others;
(iii) Open lines of credit with others;
(iv) Employment history with others;
(v) Marital status; and
(vi) Medical history.
(4) You do not satisfy the requirement
if you communicate or reserve the right
to communicate individually
identifiable health information (as
described in section 1171(6)(B) of the
Social Security Act (42 U.S.C.
1320d(6)(B)) but omit illustrative
examples of this information.
(e) Examples of categories of affiliates.
(1) You satisfy the requirement to
categorize the affiliates to which you
communicate opt out information if you
list the categories in paragraph (e)(2) of
this section, as applicable, and a few
examples to illustrate the types of
affiliates in each category.
(2) Categories of affiliates may
include:
(i) Financial service providers; and
(ii) Non-financial companies.
(f) Sample notice. A sample notice is
included in appendix A to this part.
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§ 334.6
Reasonable opportunity to opt out.
(a) In general. You provide a
reasonable opportunity to opt out if you
provide a reasonable period of time
following the delivery of the opt out
notice for the consumer to opt out.
(b) Examples of reasonable period of
time: (1) In person. You hand-deliver an
opt out notice to the consumer and
provide at least 30 days from the date
you delivered the notice.
(2) By mail. You mail an opt out
notice to a consumer and provide at
least 30 days from the date you mailed
the notice.
(3) By electronic means. You notify
the consumer electronically, and you
provide at least 30 days after the date
that the consumer acknowledges receipt
of the electronic notice.
(c) Continuing opportunity to opt out.
A consumer may opt out at any time.
§ 334.7
Reasonable means of opting out.
(a) General rule. You provide a
consumer with a reasonable means of
opting out if you provide a reasonably
convenient method to opt out.
(b) Reasonably convenient methods.
Examples of reasonably convenient
methods include:
(1) Designating check-off boxes in a
prominent position on the relevant
forms included with the opt out notice;
(2) Including a reply form together
with the opt out notice;
(3) Providing an electronic means to
opt out, such as a form that can be
electronically mailed or a process at
your web site, if the consumer agrees to
the electronic delivery of information;
or
(4) Providing a toll-free telephone
number that consumers may call to opt
out.
(c) Methods not reasonably
convenient. Examples of methods that
are not reasonably convenient include:
(1) Requiring a consumer to write his
or her own letter to you; or
(2) Referring in a revised notice to a
check-off box that you included with a
previous notice but that you do not
include with the revised notice.
(d) Requiring specific means of opting
out. You may require each consumer to
opt out through a specific means, as
long as that means is reasonable for that
consumer.
§ 334.8
Delivery of opt out notices.
(a) In general. You must deliver an opt
out notice so that each consumer can
reasonably be expected to receive actual
notice in writing or, if the consumer
agrees, electronically.
(b) Examples of expectation of actual
notice. (1) You may reasonably expect
that a consumer will receive actual
notice if you:
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(i) Hand-deliver a printed copy of the
notice to the consumer;
(ii) Mail a printed copy of the notice
to the last known mailing address of the
consumer; or
(iii) For the consumer who conducts
transactions electronically, post the
notice on your electronic site and
require the consumer to acknowledge
receipt of the notice as a necessary step
to obtaining a particular product or
service;
(2) You may not reasonably expect
that a consumer will receive actual
notice if you:
(i) Only post a sign in your branch or
office or generally publish
advertisements presenting your notice;
or
(ii) Send the notice via electronic mail
to a consumer who does not obtain a
product or service from you
electronically.
(c) Oral description insufficient. You
may not provide an opt out notice solely
by orally explaining the notice, either in
person or over the telephone.
(d) Retention or accessibility. (1) In
general. You must provide an opt out
notice so that it can be retained or
obtained at a later time by the consumer
in writing or, if the consumer agrees,
electronically.
(2) Examples of retention or
accessibility. You provide the notice so
that it can be retained or obtained at a
later time if you:
(i) Hand-deliver a printed copy of the
notice to the consumer;
(ii) Mail a printed copy of the notice
to the last known address of the
consumer upon request of the
consumer; or
(iii) Make your current notice
available on a web site (or a link to
another web site) for the consumer who
obtains a product or service
electronically and who agrees to receive
the notice at the web site.
(e) Joint notice with affiliates. You
may provide a joint notice with one or
more affiliates as long as the notice
identifies each person providing it and
is accurate with respect to each.
(f) Joint relationships. (1) In general.
Notwithstanding any other provision in
this part, if two or more consumers
jointly obtain a product or service from
you (joint consumers), the following
rules apply:
(i) You may provide a single notice to
all of the joint consumers.
(ii) Any of the joint consumers has the
opportunity to opt out.
(iii) You may treat an opt out
direction by a joint consumer either as:
(A) Applying to all of the joint
consumers; or
(B) Applying to that particular joint
consumer.
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(iv) You must explain in your opt out
notice which of the two policies set
forth in paragraph (f)(1)(iii) of this
section you will follow.
(v) If you follow the policy set forth
in paragraph (f)(1)(iii)(B) of this section,
by treating the opt out of a joint
consumer as applying to that particular
joint consumer, you must also permit:
(A) A joint consumer to opt out on
behalf of other joint consumers; and
(B) One or more joint consumers to
notify you of their opt out directions in
a single response.
(vi) You may not require all joint
consumers to opt out before you
implement any opt out direction.
(vii) If you receive an opt out by a
particular joint consumer that does not
apply to the others, you may disclose
information about the others as long as
no information is disclosed about the
consumer who opted out.
(2) Example. If consumers A and B,
who have different addresses, have a
joint checking account with you and
arrange for you to send statements to A’s
address, you may do any of the
following, but you must explain in your
opt out notice which opt out policy you
will follow. You may send a single opt
out notice to A’s address and:
(i) Treat an opt out direction by A as
applying to the entire account. If you do
so and A opts out, you may not require
B to opt out as well before
implementing A’s opt out direction.
(ii) Treat A’s opt out direction as
applying to A only. If you do so, you
must also permit:
(A) A and B to opt out for each other;
and
(B) A and B to notify you of their opt
out directions in a single response (such
as on a single form) if they choose to
give separate opt out directions.
(iii) If A opts out only for A, and B
does not opt out, you may disclose opt
out information only about B, and not
about A and B jointly.
§ 334.9
Revised opt out notice.
If you have provided a consumer with
one or more opt out notices and plan to
communicate opt out information to
your affiliates about the consumer, other
than as described in those notices, you
must provide the consumer with a
revised opt out notice that complies
with §§ 334.4 through 334.8.
§ 334.10 Time by which opt out must be
honored.
If you provide a consumer with an opt
out notice and the consumer opts out,
you must comply with the opt out as
soon as reasonably practicable after you
receive it.
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§ 334.11
63137
Duration of opt out.
An opt out remains effective until
revoked by the consumer in writing or
electronically, as long as the consumer
continues to have a relationship with
the institution. If the consumer’s
relationship with the institution
terminates, the opt out will continue to
apply to this information. However, a
new notice and opportunity to opt out
must be provided if the consumer
establishes a new relationship with the
institution.
§ 334.12 Prohibition against
discrimination.
(a) In general. If a consumer is an
applicant for credit, you must not
discriminate against the consumer if the
consumer opts out of the your
communication of opt out information
to your affiliates.
(b) Examples of discrimination
against an applicant. You discriminate
against an applicant if you:
(1) Deny the applicant credit because
the applicant opts out;
(2) Vary the terms of credit adversely
to the applicant such as by providing
less favorable pricing terms to an
applicant who opts out; or
(3) Apply more stringent credit
underwriting standards to the applicant
because the applicant opts out.
(c) Regulation B. The terms
‘‘applicant’’ and ‘‘discriminate against’’
in § 334.12 have the same meanings
ascribed to them in 12 CFR part 202.
Appendix A to Part 334—Sample
Notice
This appendix contains a sample notice to
facilitate compliance with the notice
requirements of this part. An institution may
use applicable disclosures in this sample to
provide notices required by this part.
Notice of Your Opportunity To Opt Out of
Information Sharing With Companies in Our
Corporate Family
Information We Can Share With Our
Corporate Family About You—Unless You
Tell Us Not to
What Information: Unless you tell us not
to, [Financial Institution] may share with
companies in our corporate family
information about you including:
• Information we obtain from your
application, such as [provide illustrative
examples, such as ‘‘your income’’ or ‘‘your
marital status’’];
• Information we obtain from a consumer
report, such as [provide illustrative examples,
such as ‘‘your credit score or credit history’’];
• Information we obtain to verify
representations made by you, such as
[provide illustrative examples, such as ‘‘your
open lines of credit’’]; and
• Information we obtain from a person
regarding its employment, credit, or other
relationship with you, such as [provide
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illustrative examples, such as ‘‘your
employment history’’].
Shared With Whom: Companies in our
corporate family who may receive this
information are:
• Financial service providers, such as
[provide illustrative examples, such as
‘‘mortgage bankers, broker-dealers, and
insurance agents’’]; and
• Non-financial companies, such as
[provide illustrative examples, such as
‘‘retailers, direct marketers, airlines, and
publishers’’].
571.10 Time by which opt out must be
honored.
571.11 Duration of opt out.
571.12 Prohibition against discrimination.
Appendix A to Part 571—Sample Notice
Authority: 12 U.S.C. 1462a, 1463, 1464,
1467a, 1828; 15 U.S.C. 1681s.
§ 571.1
How To Tell Us Not To Share This
Information With Our Corporate Family
If you prefer that we not share this
information with companies in our corporate
family, you may direct us not to share this
information by doing the following [insert
one or more of the reasonable means of
opting out listed below1]: [call us toll free at
{insert toll free number}]; or [visit our web
site at {insert web site address} and {provide
further instructions how to use the web site
option}]; or [e-mail us at {insert the e-mail
address}]; or [fill out and tear off the bottom
of this sheet and mail to the following
address: {insert address}]; or [check the
appropriate box on the attached form {attach
form} and mail to the following address:
{insert address}].
Note: Your direction in this paragraph
covers certain information about you that we
might otherwise share with our corporate
family. We may share other information
about you with our corporate family as
permitted by law.
By order of the Board of Directors, Federal
Deposit Insurance Corporation.
Dated at Washington, D.C., this 25th day of
September, 2000.
Robert E. Feldman,
Executive Secretary.
Office of Thrift Supervision
§ 571.2
12 CFR Chapter V
For the reasons set out in the joint
preamble, OTS proposes to amend
chapter V of title 12 of the Code of
Federal Regulations by adding a new
part 571 to read as follows:
§ 571.3
PART 571—FAIR CREDIT REPORTING
Sec.
571.1 Purpose and scope.
571.2 Examples.
571.3 Definitions.
571.4 Communication of opt out
information to affiliates.
571.5 Content of opt out notice.
571.6 Reasonable opportunity to opt out.
571.7 Reasonable means of opting out.
571.8 Delivery of opt out notice.
571.9 Revised opt out notice.
1 If the financial institution is using its web site
or an e-mail address as the only method by which
a consumer may opt out, the consumer must agree
to the electronic delivery of information.
13:23 Oct 19, 2000
Examples.
The examples used in this part and
the model form in appendix A to this
part are not exclusive. Compliance with
an example or use of the sample notice,
to the extent applicable, constitutes
compliance with this part.
Authority and Issuance
VerDate 11<MAY>2000
Purpose and scope.
(a) Purpose. This part governs the
collection, communication, and use, by
the institutions listed in paragraph (b)(2)
of this section, of certain information
bearing on a consumer’s credit
worthiness, credit standing, credit
capacity, character, general reputation,
personal characteristics, or mode of
living.
(b) Scope. (1) Information covered.
This part applies to information that is
used or expected to be used or collected
in whole or in part for the purpose of
serving as a factor in establishing a
consumer’s eligibility for credit,
insurance, employment, or any other
purpose authorized under section 604 of
the Fair Credit Reporting Act (15 U.S.C.
1681b).
(2) Institutions covered. This part
applies to savings associations whose
deposits are insured by the Federal
Deposit Insurance Corporation.
(3) Relation to other laws. Nothing in
this part modifies, limits, or supersedes
the standards governing the privacy of
individually identifiable health
information promulgated by the
Secretary of Health and Human Services
under the authority of sections 262 and
264 of the Health Insurance Portability
and Accountability Act of 1996 (42
U.S.C. 1320d–1320d–8).
Definitions.
As used in this part, unless the
context requires otherwise:
(a) Act means the Fair Credit
Reporting Act (15 U.S.C. 1681 et seq.).
(b) Affiliate. (1) In general. The term
means any company that is related or
affiliated by common ownership, or
affiliated by corporate control or
common corporate control, with another
company.
(2) Related or affiliated by common
ownership or affiliated by corporate
control or common corporate control.
This means controlling, controlled by,
or under common control with, another
company.
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(c) Clear and conspicuous. (1) In
general. The term means that a notice is
reasonably understandable and is
designed to call attention to the nature
and significance of the information it
contains.
(2) Examples. (i) Reasonably
understandable. You make your notice
reasonably understandable if you:
(A) Present the information in the
notice in clear and concise sentences,
paragraphs, and sections;
(B) Use short explanatory sentences or
bullet lists whenever possible;
(C) Use definite, concrete, everyday
words and active voice whenever
possible;
(D) Avoid multiple negatives;
(E) Avoid legal and highly technical
business terminology whenever
possible; and
(F) Avoid explanations that are
imprecise and are readily subject to
different interpretations.
(ii) Designed to call attention. You
design your notice to call attention to
the nature and significance of the
information it contains if you:
(A) Use a plain-language heading to
call attention to the notice;
(B) Use a typeface and type size that
are easy to read;
(C) Provide wide margins and ample
line spacing;
(D) Use boldface or italics for key
words; and
(E) In a form that combines your
notice with other information, use
distinctive type sizes, styles, and
graphic devices, such as shading or
sidebars.
(iii) Notice on a web page. If you
provide a notice on a web page, you
design your notice to call attention to
the nature and significance of the
information it contains if:
(A) You place either the notice, or a
link that connects directly to the notice
and that is labeled appropriately to
convey the importance, nature, and
relevance of the notice, on a page that
consumers access often, such as a page
on which transactions are conducted;
(B) You use text or visual cues to
encourage scrolling down the page if
necessary to view the entire notice; and
(C) You ensure that other elements on
the web page (such as text, graphics,
links, or sound) do not detract attention
from the notice.
(d) Communication includes written,
oral, and electronic communication;
provided that the term includes
electronic communication to a
consumer only if the consumer agrees to
receive the communication
electronically.
(e) Company means any corporation,
limited liability company, business
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trust, general or limited partnership,
association, or similar organization.
(f) Consumer means an individual.
(g) Consumer report. (1) In general.
The term means any written, oral, or
other communication of any
information by a consumer reporting
agency bearing on a consumer’s credit
worthiness, credit standing, credit
capacity, character, general reputation,
personal characteristics, or mode of
living which is used or expected to be
used or collected in whole or in part for
the purpose of serving as a factor in
establishing the consumer’s eligibility
for:
(i) Credit or insurance to be used
primarily for personal, family, or
household purposes;
(ii) Employment purposes; or
(iii) Any other purpose authorized
under section 604 of the Act (15 U.S.C.
1681b).
(2) Exclusions. The term does not
include:
(i) Any report containing information
solely as to transactions or experiences
between the consumer and the person
making the report;
(ii) Any communication of that
information among affiliates;
(iii) Any communication among
affiliates of opt out information if the
conditions in §§ 571.4 through 571.9 are
satisfied;
(iv) Any authorization or approval of
a specific extension of credit directly or
indirectly by the issuer of a credit card
or similar device;
(v) Any report in which a person who
has been requested by a third party to
make a specific extension of credit
directly or indirectly to a consumer
conveys his or her decision with respect
to such request, if the third party
advises the consumer of the name and
address of the person to whom the
request was made, and the person
makes the disclosures to the consumer
required under section 615 of the Act
(15 U.S.C. 1681m); or
(vi) A communication described in
section 603(o) of the Act (15 U.S.C.
1681a(o)).
(h) Consumer reporting agency means
any person which, for monetary fees,
dues or on a cooperative nonprofit basis,
regularly engages in whole or in part in
the practice of assembling or evaluating
consumer credit information or other
information on consumers for the
purpose of furnishing consumer reports
to third parties, and which uses any
means or facility of interstate commerce
for the purpose of preparing or
furnishing consumer reports.
(i) Control of a company means:
(1) Ownership, control, or power to
vote 25 percent or more of the
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13:23 Oct 19, 2000
outstanding shares of any class of voting
security of the company, directly or
indirectly, or acting through one or
more other persons;
(2) Control in any manner over the
election of a majority of the directors,
trustees, or general partners (or
individuals exercising similar functions)
of the company; or
(3) The power to exercise, directly or
indirectly, a controlling influence over
the management or policies of the
company, as OTS determines.
(j) Opt out means a direction by a
consumer that you not communicate opt
out information about the consumer to
one or more of your affiliates.
(k) Opt out information means
information that:
(1) Bears on a consumer’s credit
worthiness, credit standing, credit
capacity, character, general reputation,
personal characteristics, or mode of
living;
(2) Is used or expected to be used or
collected in whole or in part to serve as
a factor in establishing the consumer’s
eligibility for credit or another purpose
listed in section 604 of the Act (15
U.S.C. 1681b); and
(3) Is not a report containing
information solely as to transactions or
experiences between the consumer and
the person reporting or communicating
the information.
(l) Person means any individual,
partnership, corporation, trust, estate,
cooperative, association, government or
governmental subdivision or agency, or
other entity.
(m) You means savings associations
whose deposits are insured by the
Federal Deposit Insurance Corporation.
§ 571.4 Communication of opt out
information to affiliates.
Your communication to your affiliates
of opt out information about a consumer
is not a consumer report if:
(a) You have provided the consumer
with an opt out notice;
(b) You have given the consumer a
reasonable opportunity and means,
before you communicate the
information to your affiliates, to opt out;
and
(c) The consumer has not opted out.
§ 571.5
Content of opt out notice.
(a) In general. An opt out notice must
be clear and conspicuous, and must
accurately explain:
(1) The categories of opt out
information about the consumer that
you communicate to your affiliates;
(2) The categories of affiliates to
which you communicate the
information;
(3) The consumer’s ability to opt out;
and
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63139
(4) A reasonable means for the
consumer to opt out.
(b) Future communications. Your
notice may describe:
(1) Categories of opt out information
about the consumer that you reserve the
right to communicate to your affiliates
in the future but do not currently
communicate; and
(2) Categories of affiliates to which
you reserve the right in the future to
communicate, but to which you do not
currently communicate, opt out
information about the consumer.
(c) Partial opt out. You may allow a
consumer to select certain opt out
information or certain affiliates, with
respect to which the consumer wishes
to opt out.
(d) Examples of categories of
information that you communicate. (1)
You satisfy the requirement to
categorize the opt out information that
you communicate if you list the
categories in paragraph (d)(2) of this
section, as applicable, and a few
examples to illustrate the types of
information in each category. These
examples may include those in
paragraph (d)(3) of this section, if
applicable.
(2) Categories of opt out information
may include information:
(i) From a consumer’s application;
(ii) From a consumer credit report;
(iii) Obtained by verifying
representations made by a consumer; or
(iv) Provided by another person
regarding its employment, credit, or
other relationship with a consumer.
(3) Examples of information within a
category listed in paragraph (d)(2) of
this section include a consumer’s:
(i) Income;
(ii) Credit score or credit history with
others;
(iii) Open lines of credit with others;
(iv) Employment history with others;
(v) Marital status; and
(vi) Medical history.
(4) You do not satisfy the requirement
if you communicate or reserve the right
to communicate individually
identifiable health information (as
described in section 1171(6)(B) of the
Social Security Act (42 U.S.C.
1320d(6)(B)) but omit illustrative
examples of this information.
(e) Examples of categories of affiliates.
(1) You satisfy the requirement to
categorize the affiliates to which you
communicate opt out information if you
list the categories in paragraph (e)(2) of
this section, as applicable, and a few
examples to illustrate the types of
affiliates in each category.
(2) Categories of affiliates may
include:
(i) Financial service providers; and
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(ii) Non-financial companies.
(f) Sample notice. A sample notice is
included in appendix A to this part.
(b) Examples of expectation of actual
notice. (1) You may reasonably expect
that a consumer will receive actual
notice if you:
§ 571.6 Reasonable opportunity to opt out.
(i) Hand-deliver a printed copy of the
(a) In general. You provide a
notice to the consumer;
reasonable opportunity to opt out if you
(ii) Mail a printed copy of the notice
provide a reasonable period of time
to the last known mailing address of the
following the delivery of the opt out
consumer; or
notice for the consumer to opt out.
(iii) For the consumer who conducts
(b) Examples of reasonable period of
transactions electronically, post the
time: (1) In person. You hand-deliver an notice on your electronic site and
opt out notice to the consumer and
require the consumer to acknowledge
provide at least 30 days from the date
receipt of the notice as a necessary step
you delivered the notice.
to obtaining a particular product or
(2) By mail. You mail an opt out
service;
notice to a consumer and provide at
(iv) You may not reasonably expect
least 30 days from the date you mailed
that a consumer will receive actual
the notice.
notice if you:
(3) By electronic means. You notify
(A) Only post a sign in your branch
the consumer electronically, and you
or office or generally publish
provide at least 30 days after the date
advertisements presenting your notice;
that the consumer acknowledges receipt or
(B) Send the notice via electronic mail
of the electronic notice.
(c) Continuing opportunity to opt out. to a consumer who does not obtain a
product or service from you
A consumer may opt out at any time.
electronically.
§ 571.7 Reasonable means of opting out.
(c) Oral description insufficient. You
(a) General rule. You provide a
may not provide an opt out notice solely
consumer with a reasonable means of
by orally explaining the notice, either in
opting out if you provide a reasonably
person or over the telephone.
convenient method to opt out.
(d) Retention or accessibility. (1) In
(b) Reasonably convenient methods.
general. You must provide an opt out
Examples of reasonably convenient
notice so that it can be retained or
methods include:
obtained at a later time by the consumer
(1) Designating check-off boxes in a
in writing or, if the consumer agrees,
prominent position on the relevant
electronically.
forms included with the opt out notice;
(2) Examples of retention or
(2) Including a reply form together
accessibility. You provide the notice so
with the opt out notice;
that it can be retained or obtained at a
(3) Providing an electronic means to
later time if you:
opt out, such as a form that can be
(i) Hand-deliver a printed copy of the
electronically mailed or a process at
notice to the consumer;
(ii) Mail a printed copy of the notice
your web site, if the consumer agrees to
to the last known address of the
the electronic delivery of information;
consumer upon request of the
or
(4) Providing a toll-free telephone
consumer; or
(iii) Make your current notice
number that consumers may call to opt
available on a web site (or a link to
out.
another web site) for the consumer who
(c) Methods that are not reasonably
obtains a product or service
convenient. Examples of methods that
electronically and who agrees to receive
are not reasonably convenient include:
(1) Requiring a consumer to write his
the notice at the web site.
(e) Joint notice with affiliates. You
or her own letter to you; or
(2) Referring in a revised notice to a
may provide a joint notice with one or
check-off box that you included with a
more affiliates as long as the notice
identifies each person providing it and
previous notice but that you do not
is accurate with respect to each.
include with the revised notice.
(f) Joint relationships. (1) In general.
(d) Requiring specific means of opting
Notwithstanding any other provision in
out. You may require each consumer to
this part, if two or more consumers
opt out through a specific means, as
long as that means is reasonable for that jointly obtain a product or service from
you (joint consumers), the following
consumer.
rules apply:
§ 571.8 Delivery of opt out notice.
(i) You may provide a single notice to
(a) In general. You must deliver an opt all of the joint consumers.
out notice so that each consumer can
(ii) Any of the joint consumers has the
reasonably be expected to receive actual opportunity to opt out.
(iii) You may treat an opt out
notice in writing or, if the consumer
direction by a joint consumer either as:
agrees, electronically.
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(A) Applying to all of the joint
consumers; or
(B) Applying to that particular joint
consumer.
(iv) You must explain in your opt out
notice which of the two policies set
forth in paragraph (f)(1)(iii) of this
section you will follow.
(v) If you follow the policy set forth
in paragraph (f)(1)(iii)(B) of this section,
by treating the opt out of a joint
consumer as applying to that particular
joint consumer, you must also permit:
(A) A joint consumer to opt out on
behalf of other joint consumers; and
(B) One or more joint consumers to
notify you of their opt out directions in
a single response.
(vi) You may not require all joint
consumers to opt out before you
implement any opt out direction.
(vii) If you receive an opt out by a
particular joint consumer that does not
apply to the others, you may disclose
information about the others as long as
no information is disclosed about the
consumer who opted out.
(2) Example. If consumers A and B,
who have different addresses, have a
joint checking account with you and
arrange for you to send statements to A’s
address, you may do any of the
following, but you must explain in your
opt out notice which opt out policy you
will follow. You may send a single opt
out notice to A’s address and:
(i) Treat an opt out direction by A as
applying to the entire account. If you do
so and A opts out, you may not require
B to opt out as well before
implementing A’s opt out direction.
(ii) Treat A’s opt out direction as
applying to A only. If you do so, you
must also permit:
(A) A and B to opt out for each other;
and
(B) A and B to notify you of their opt
out directions in a single response (such
as on a single form) if they choose to
give separate opt out directions.
(iii) If A opts out only for A, and B
does not opt out, you may disclose opt
out information only about B, and not
about A and B jointly.
§ 571.9
Revised opt out notice.
If you have provided a consumer with
one or more opt out notices and plan to
communicate opt out information to
your affiliates about the consumer, other
than as described in those notices, you
must provide the consumer with a
revised opt out notice that complies
with §§ 571.4 through 571.8.
§ 571.10 Time by which opt out must be
honored.
If you provide a consumer with an opt
out notice and the consumer opts out,
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you must comply with the opt out as
soon as reasonably practicable after you
receive it.
§ 571.11
Duration of opt out.
An opt out remains effective until
revoked by the consumer in writing or
electronically, as long as the consumer
continues to have a relationship with
the institution. If the consumer’s
relationship with the institution
terminates, the opt out will continue to
apply to this information. However, a
new notice and opportunity to opt out
must be provided if the consumer
establishes a new relationship with the
institution.
§ 571.12 Prohibition against
discrimination.
(a) In general. You must not
discriminate against a consumer who is
an applicant for credit because the
consumer opts out of your
communication of opt out information
to your affiliates.
(b) Examples of discrimination
against an applicant. You discriminate
against an applicant if you:
(1) Deny the applicant credit because
the applicant opts out;
(2) Vary the terms of credit adversely
to the applicant such as by providing
less favorable pricing terms to an
applicant who opts out; or
(3) Apply more stringent credit
underwriting standards to the applicant
because the applicant opts out.
(c) Regulation B. The terms
‘‘applicant’’ and ‘‘discriminate against’’
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in this section have the same meanings
ascribed to them in 12 CFR part 202.
Appendix A to Part 571—Sample
Notice
This appendix contains a sample notice to
facilitate compliance with the notice
requirements of this part. An institution may
use applicable disclosures in this sample to
provide notices required by this part.
Notice of Your Opportunity to Opt Out of
Information Sharing With Companies in Our
Corporate Family
Information We Can Share With Our
Corporate Family About You—Unless You
Tell Us Not to
What Information: Unless you tell us not
to, [Financial Institution] may share with
companies in our corporate family
information about you including:
• Information we obtain from your
application, such as [provide illustrative
examples, such as ‘‘your income’’ or ‘‘your
marital status’’];
• Information we obtain from a consumer
report, such as [provide illustrative examples,
such as ‘‘your credit score or credit history’’];
• Information we obtain to verify
representations made by you, such as
[provide illustrative examples, such as ‘‘your
open lines of credit’’]; and
• Information we obtain from a person
regarding its employment, credit, or other
relationship with you, such as [provide
illustrative examples, such as ‘‘your
employment history’’].
Shared With Whom: Companies in our
corporate family who may receive this
information are:
• Financial service providers, such as
[provide illustrative examples, such as
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‘‘mortgage bankers, broker-dealers, and
insurance agents’’]; and
• Non-financial companies, such as
[provide illustrative examples, such as
‘‘retailers, direct marketers, airlines, and
publishers’’].
How To Tell Us Not To Share This
Information With Our Corporate Family
If you prefer that we not share this
information with companies in our corporate
family, you may direct us not to share this
information by doing the following [insert
one or more of the reasonable means of
opting out listed below1]: [call us toll free at
{insert toll free number}]; or [visit our web
site at {insert web site address} and {provide
further instructions how to use the web site
option}]; or [e-mail us at {insert the e-mail
address}]; or [fill out and tear off the bottom
of this sheet and mail to the following
address: {insert address}]; or [check the
appropriate box on the attached form {attach
form} and mail to the following address:
{insert address}].
Note: Your direction in this paragraph
covers certain information about you that we
might otherwise share with our corporate
family. We may share other information
about you with our corporate family as
permitted by law.
Dated: September 29, 2000.
By the Office of Thrift Supervision.
Ellen Seidman,
Director.
[FR Doc. 00–26601 Filed 10–19–00; 8:45 am]
BILLING CODE 4810–33–P; 6210–01P; 6714–01–P; 6720–
01–P
1 If the financial institution is using its web site
or an e-mail address as the only method by which
a consumer may opt out, the consumer must agree
to the electronic delivery of information.
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