| Zip your lenders' lips with opt-out
notices |
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You may not always recognize the
privacy statements. The notices that enable you to opt out may be
just another piece of paper stuffed in with your monthly statement
or they may arrive in a separate envelope.
There's no particular format the institutions
have to follow, but the word "privacy" should be fairly
prominent. Read the fine print of all inserts, looking for phrases
such as "Privacy Notice," "Privacy Policy,"
and "Opt-out Notice," informs the Privacy Rights Clearinghouse.
Unfortunately, you won't know when to expect
a privacy notice. Once the July 1, 2001 deadline for the initial
privacy notices passed, financial institutions had the option of
picking any 12-month consecutive period to send the annual notice.
Consumers will get them every year, but scattered
throughout the year. So now unless you have time to follow the notice
cycle, you will just have to look at every piece of paper that comes
in the mail.
The silver lining
Fortunately, once an opt-out choice is made on an account,
it stays in effect unless the consumer changes it, says Friery.
You don't have to opt-out every year for each account. You should
always get a privacy notice when you open a new account, whether
it's with the same institution or a different one.
If you mistakenly toss a notice, you can ask
for another privacy notice from your financial institution and exercise
any opt out choice that is given.
The American Bankers Association estimates that many households
could get 15 or more notices. So it will pay to carefully read the
fine print of your mail.
How simple is simple enough?
Consumers complained that the first privacy notices were confusing.
"Many of the first privacy notices were legalistic and convoluted,"
said Dean Sager, the spokesman for the then Rep. John LaFalce D-N.Y.,
who introduced the privacy provisions as part of Gramm-Leach-Bliley.
"What was intended to be a two- or three-page pamphlet sometimes
went to eight or 10 pages. The vehicles for opting out weren't clear
in many cases. It confused what your options were. Very few said,
'You have the right to determine who sees your information.'"
Bank of America, one of the nation's biggest banks, sent out nearly
45 million privacy notices in 2002. After listening to customer
focus groups, they've again made changes to their privacy notice.
They've eliminated a worksheet that consumers found confusing, plus
added a section on identity theft.
Spokesman Scott Scredon says they don't get any responses back
from the privacy notices because the bank began a policy of not
sharing information with unaffiliated third parties almost four
years ago.
"We did it because we thought it was the right thing to do
and we think it gives us a competitive edge," says Scredon.
Friery agrees.
But on the whole, Friery has seen minor improvements, but nothing
significant, in the readability of privacy notices.
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